Welcome to The Heritage Foundation’s guide to the best solutions to America’s biggest issues. Here you will find easy-to-understand solutions to address issues such as improving health care choices and lowering costs, addressing climate change, reforming welfare, creating jobs, increasing individual liberty, and so much more.
This site provides a plain-language summary of each issue, solutions our elected leaders should act on, and facts and figures to support each recommendation. It also provides key points that you can use when talking to others.
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On March 11, 2020, the novel coronavirus was declared a pandemic, and two days later the United States entered a state of emergency. The disease has wreaked havoc on the lives and livelihoods of millions of Americans who have dramatically changed their behavior and businesses in response. States have reinforced these changes with stay-at-home orders and mandatory closures of “non-essential” businesses. Millions of American workers are now jobless.
To help guide local, state, and federal policymakers, the private sector, and communities through crisis and into recovery, The Heritage Foundation assembled the National Coronavirus Recovery Commission. The mission is clear: Develop recommendations to protect both lives and livelihoods. Essential to any response is a strong commitment to the Constitution and to the American values of individual liberty and free enterprise that have made this country great and guided it through many severe challenges. America is strengthened by its states, which, as laboratories of democracy, allow decisions to be made closest to and reflective of the needs of the people. The states, in turn, are critically aided by Congress and the executive branch, which provide reliable information, regulatory relief, coordination, and targeted and temporary funding. This governing system of unity and diversity has enabled a flexible response to a virus with widely divergent effects in communities across the country and within states.
Building on that solid ground, policymakers, the private sector, and civil society must navigate a return to work while making strategic adjustments to slow the spread of the virus. Indeed, good public health policy is good economic policy: lives and livelihoods.
A sound public health strategy not only helps to reduce illness and mortality associated with the disease, but also helps to mitigate the long-term economic effects. Health policy should thus focus on constraining the spread of the infection, treating and quarantining the sick, and protecting the most vulnerable—not on shutting down American life. Indiscriminate “lockdowns” are blunt tools that neither qualify as intrinsically good public health policy, nor adequately reflect the varied virus exposure within states and regions. Rather, states and localities should employ more far more measured, data-driven approaches. At the same time, policymakers should expand Americans’ access to healthcare and reduce regulatory barriers that inhibit innovation in research and development of disinfectants, therapeutics, and vaccines needed to help fight the virus.
Economic policy should focus on empowering Americans and businesses to safely return to work. Work and workplaces are central to American life, not just for the sake of the economy but also for the well-being of individuals, families, and communities. Temporary and targeted aid is useful. But the government cannot spend its way into national prosperity: Americans need paychecks more than they need stimulus checks. Therefore, durable policy change will send a stronger signal of the stability and confidence American businesses and workers need to innovate and adapt to a new normal. Regulatory reform has been essential to crisis response, opening up critical resources and enabling people to solve problems expeditiously across the economy, civil society, and public health sectors. It will indispensable to a confident recovery.
Similarly, by strengthening economic freedom among America’s allies and partners, the U.S. can lead a global recovery. Throughout history, there has been no better model than that of free enterprise for how to lift people out of poverty and into better, healthier standards of living. Now is the time to double down on that commitment. Countless American jobs involve the exchange of materials with our allies and trading partners around the world; those jobs also depend upon the skills and talents of people on both sides. The virus also has posed global challenges, and solutions will similarly come through the synergy of a network response. Reopening supply chains and removing barriers to free trade will reinvigorate economic activity and improve access to innovative life-saving technology to fight the virus. At the same time, the experience of the pandemic has highlighted areas in which the U.S. is too reliant on foreign sources and manufacturing for critical supplies, and underscores the need to verify information and data coming from authoritarian regimes that lack accountability.
Looking ahead to the future, it is critical that when the next pandemic comes, we are not simply responding to the previous one, or ignoring the investments already made toward preparedness. Even now, governments at all levels should review funding priorities and amend their regulatory environments to be more flexible in crises. Businesses must learn now how to adapt quickly for the future. And civil society must be strengthened so that Americans have thriving communities to which they can turn when they need support. Where structural change is needed to our safety nets, health care systems, and financial systems, we should evaluate the needs and pursue appropriate reforms now.
While each branch and level of government is playing an important role in responding to the current pandemic, no other sector of society has been as essential or successful as have everyday Americans and businesses, who have rallied in creative ways to help one another and meet the needs that the government cannot. The best and the brightest have stepped forward during this pandemic to work on the most challenging problems of the day. This experience also has demonstrated exactly how important free markets and ideas are to overcoming crises; free markets and ideas unleash the incredible ingenuity of the private sector and civil society. Recovery will be driven by American innovators, entrepreneurs, businesses, and consumers. They are the key to recovery and hope for whatever the future holds.
The National Coronavirus Recovery Commission has offered 265 recommendations for an “all of society” approach that engages state and local governments, Congress, the Administration, businesses, schools, community organizations, churches, and civil society as they navigate the current crisis and prepare for the next. The recommendations cover a wide swath of issues ranging from healthcare access, education, protections for the vulnerable and disabled individuals, and improvements to the Paycheck Protection Program to international trade and travel, barriers to innovation and research, 5G infrastructure, tax policy, and small business capital formation, among many others. Together, these recommendations inform a balanced strategy to save both lives and livelihoods.
Key among these are recommendations that would quickly reinvigorate economic activity while making smart accommodations for vulnerable individuals and communities.
States and local governments should allow businesses in counties with low incidence of COVID-19 to reopen. Just five states—New York, New Jersey, Massachusetts, Illinois, and California—accounted for 50 percent of all of the confirmed COVID-19 cases in the U.S. and 57 percent of all related deaths by May 2020. Most counties (80 percent) have had fewer than five deaths related to the new coronavirus.
States and local governments should use stay-at-home orders sparingly and only where necessary. Better, more targeted approaches should focus on infection hot spots, isolate the sick from the workplace, and protect the more vulnerable (those who are elderly, in nursing homes, or have preexisting conditions).
The White House should establish a national portal with accessible data on the spread of the coronavirus as well as the modeling used to support decisions made by governments at all levels. Access to information is absolutely critical for governments, medical professionals, businesses, and individuals to make the best decisions on how best to respond. Specifically, the availability of this information would reinforce consistency in standards that can be carried out locally, helping physicians. More access to information also would help to eliminate uncertainty about the virus that hurts the confidence of businesses and consumers.
States and local governments should immediately allow all medical offices to reopen. Many states shut down health care services considered “nonessential” to prepare for projected massive surges in patients infected by the coronavirus. This government-created impediment has hindered the ability of medical professionals to meet Americans’ ongoing health care needs, and many medical workers are being unnecessarily furloughed. Amid an unprecedented health crisis, over one million health care workers face unemployment.
All federal departments and independent agencies should review all regulations that have been waived or modified in response to COVID-19 and consider permanent changes. Such a clear statement by the President to executive agencies would provide more long-term confidence and stability for businesses by ensuring regulatory regimes work in good times and bad, facilitate innovation and market advancement, and still protect health and safety.
State and local governments should make decisions based on data for the local district, and even the specific school, not the entire state. Further, states should help families return to work, and students to maintain education continuity by lifting barriers to online education and making education funding student-centered and portable.
The federal government should partner with churches, grassroots organizations, NGOs, and state and local governments to increase wellness education, including education on nutrition, fitness, and risk avoidance, among minority communities. This is necessary because of the disproportionate effect of this virus in minority communities. Regardless of their race or color, Americans must be vigilant in adhering to mitigation efforts if they must leave their homes each day to go to work. If minority communities are not participating in recommended risk avoidance, they risk a slower return to normal. Further, the President should task federal health agencies, as they build scientific understanding of COVID-19, with investigating the underlying causes of the virus’s disparate impact on minority and other communities.
Congress should expand liability protections with a safe harbor for businesses and workers that follow guidance by the Centers for Disease Control and Prevention in good faith. A safe harbor by Congress would provide much-needed confidence and stability that would encourage business owners to reopen.
Congress should liberalize future Paycheck Protection Program loans to broaden eligible expenditures, extend the relevant period, and limit the loans to businesses that were hit hard. Businesses that were forced to shut down must rehire and retrain employees, secure inventory, reestablish vendor relationships, and settle balances. Congress should broaden what can be paid for and forgiven with new Paycheck Protection Program (PPP) loans for businesses that suffered a substantial decline in gross revenues because of the coronavirus.
Congress should reduce small-business tax liability with a “physical presence” standard. Every small business that sells online, no matter where it is physically located, is subject to the more than 10,000 different taxing jurisdictions around the country—each with its own tax rates and rules. This burdensome, complex requirement threatens to bankrupt many small retailers and prohibit others from retooling to ship new products. Congress should protect vulnerable retailers by codifying a physical presence test for tax collection.
Congress and the Administration should coordinate legislative and regulatory changes to expand access to capital for small businesses. Entrepreneurs will drive recovery by reopening existing businesses and taking on new risks to meet new needs in the post-crisis world. Congress and the Securities and Exchange Commission should remove barriers for small businesses to access peer-to-peer lending, credit unions, and investment finders. By simplifying exemptions and disclosure frameworks, and working to simplify regulations, small public companies will find it easier to recover and grow.
Congress should incentivize research and development and infrastructure investments with permanent full expensing. Starting in 2022, research and development expenses and new spending on machinery and tools no longer will be fully deductible, which will discourage innovation and investment. Research and development spending is critical as the private sector develops new remedies and reorganizes to meet the needs of a post-coronavirus recovery.
America’s thought leaders (economists, academics, authors, and journalists) should investigate and communicate how freedom has shaped America’s response to the coronavirus and its economic effects in contrast to responses by authoritarian regimes such as China. America’s freedom of speech and press, freedom of association, freedom of conscience and religion, and right to free assembly have enabled civil society to participate in disseminating information about the virus and to provide medical, material, and social assistance to citizens in ways that government cannot. In addition, our freedoms have enabled citizens to hold federal, state, and local government accountable. These positive externalities of civil rights, in addition to economic freedom, should be included in messaging about America’s leadership of the free world’s economic recovery.
The Administration should eliminate all tariffs imposed since 2018. Trade freedom is vital to economic recovery and to building certainty in supply chains. Countless U.S. jobs depend on materials from Great Britain, the European Union, and around the world—and vice versa. The Trump Administration should remove Section 201, Section 232, and Section 301 tariffs to benefit all parties.
Fact: COVID-19 is the latest in a series of highly infectious viruses that have appeared over the course of modern history.
Fact: Although all states have reported cases of COVID-19, the distribution of cases and deaths has remained heavily concentrated in a small number of states and counties.
Fact: National and global economic activity have been hit hard by the novel coronavirus pandemic.
Fact: Indiscriminate shutdown orders are extremely costly and have blocked access to important ongoing healthcare for Americans.
Americans have access to some of the best medical care in the world. However, excessive and ill-conceived government intervention in health care financing and delivery has helped produce a system that is too costly, complex, confusing, and inefficient.
While nearly every American, regardless of income or medical condition, has access to health insurance coverage, many lack access to or choice of adequate, patient-centered care. Government policies have contributed to more consolidation among providers and insurers, reducing choices and increasing costs. Unlike in most other segments of the economy, consumers often do not know the price of medical goods and services until after the bill arrives. Americans are rightly frustrated.
Government policy is a significant driver of these long-standing problems, which were made far worse in recent years through Obamacare. While the policies are myriad, most share a common flaw: a centralized, top-down federal government management that is unworkable, unaffordable, and unfair. The federal government’s role in health care elevates bureaucracy and regulation above the most important relationship in medicine: the relationship between patients and their doctors.
Many of these problems with our health care system became more visible and acute with the COVID-19 pandemic. Widespread lockdown orders put tens of millions of people out of work, leaving many without their job-based coverage. Government regulation limited the options available to unemployed workers to gain coverage for themselves and their families.
At the same time, the crisis inspired a government response that rolled back regulatory restrictions that limit competition and restrict consumer choice. Both Congress and the executive branch took steps to expand telemedicine, for example, and proposals surfaced to expand health savings accounts and to allow them to be used to pay insurance premiums and fees for direct primary care arrangements.
Real, patient-centered reform requires Congress to make temporary regulatory relief and do more to roll back damaging policies and enlarge health care choice and competition. Congress’s failure to replace Obamacare in 2017 convinced many conservative lawmakers that they should avoid talking about health care, creating a leadership vacuum that politicians on the Left quickly exploited by calling for even more government intervention. Conservatives have health care policy ideas that can deliver lower health care costs and more choices. They should advance their policy vision, which would benefit all Americans.
As an alternative to the Left’s failed government-centric policies, conservatives propose policies grounded in a vision that is patient-centered and market-based, a vision that rolls back government officials’ control over health care in favor of empowering consumers. This vision gives Americans and their families much greater control over their health care dollars and decisions. If individuals and families are the key decision makers, then powerful economic incentives will realign the interests of plans, providers, and patients to maximize value by delivering higher-quality care and services at lower cost. Achieving this patient-centered, free-market vision would require a range of regulatory and financing reforms to a host of federal and state programs and laws.
Stop the Left’s drive to single-payer, government monopoly health care. The last several decades saw significant expansions in the role of government in health care. Today, nearly 38 percent of Americans get their health care via numerous programs across many government agencies that subsidize and regulate health care, including 10 major federal and state means-tested programs for medical care. In recent years, coverage gains under Obamacare were due primarily to adding able-bodied adults to Medicaid, a government-run health care program once intended for the nation’s most vulnerable: children, people with disabilities, pregnant women, and elderly Americans in poverty. Because the program pays providers so little, many doctors refuse to see Medicaid patients, leaving beneficiaries with coverage but too often without access to care. Many on the Left now seek to replace these programs with a new single-payer, government-run health care program or variations on such a model. Others want to introduce a “public option” program in which a government-run coverage program would be offered alongside private insurance. Still others want to expand existing programs, like Obamacare, with new infusions of cash and federal requirements. Policymakers must reject these proposals as false solutions that will hurt, not help, Americans and instead give Americans what they want: lower cost and more choice.
Remove regulatory mandates that block consumer choice, competition, and market principles. Health care is one of the most over-regulated sectors of the U.S. economy. Regulations block patients from getting the coverage and care of their choice, and they block medical providers and insurers from responding to client needs. Medicare and Medicaid fix prices for hospital and physician services. These payments not only distort price signals, but also have led to a system in which people with private coverage pay taxes to subsidize government programs and also pay higher premiums for insurance in order to reimburse providers at rates in excess of those paid by public programs. Government also imposes regulations that burden providers and distort competition by unfairly favoring some competitors over others. Medicare, for example, pays higher fees to hospitals than to ambulatory surgical centers for the very same procedure. Too often, regulations governing the delivery and financing of medical care by doctors, hospitals, and insurers impede innovations that might disrupt the long-standing business models with which the incumbent players are comfortable. In short, government distorts health care prices, burdens patients and providers with cumbersome regulations, and stifles innovation, resulting in a system that is outdated, inefficient, and unnecessarily costly.
Government worsened the situation when it imposed mandates on small businesses and on individuals who do not have employer-sponsored coverage. Obamacare’s costly insurance mandates, regulations, and premiums subsidies drove up the cost of insurance both inside and outside the government-run exchanges. Many insurers fled the market, resulting in fewer choices for consumers and insurance company monopolies in many areas of the country. That same law also enlarged the government’s role in the delivery of care by imposing rules, regulations, and red tape that further frustrated health care providers, undermined the doctor–patient relationship, and trampled personal and religious freedoms.
To address this distortion, policymakers should conduct a comprehensive review and removal of regulatory obstacles at the federal and state level that prevent a free, competitive, and patient-centered market from flourishing.
Empower consumers to choose the right coverage arrangement for themselves. Today, consumers who want to limit their financial exposure to medical costs have limited choices, due to a hodgepodge of government regulations and mandates. At all income levels, there are fewer choices due to Obamacare, which provides limited options with narrow networks. Today, 71 percent of U.S. counties either have no insurer choice, or a choice between only 2 insurers—a sharp increase from 33 percent in 2015.
In some cases, people have been priced out of the market altogether because they cannot afford Obamacare plan premiums or deductibles. Lower-income individuals who qualify for government help are often herded into state-contracted managed care organizations.
These individuals should be empowered to purchase the right coverage for themselves. Federal policymakers can make that easier by allowing those who receive subsidies to apply the value of their subsidies to the private coverage of their choice. And, policymakers should allow greater flexibility and access to more innovative arrangements, such as, for example, Health Savings Accounts, insurance plans exempt from Obamacare’s mandates, Direct Primary Care arrangements, and sharing ministries.
Reform federal health care entitlement programs. Medicare and Medicaid were created in 1965. Medicare was established to provide medical services to seniors, while Medicaid was created to provide medical services to vulnerable groups in poverty. Federal health spending—driven largely by individual entitlement programs like Medicare and Medicaid—is the largest portion of the federal budget, larger than both Social Security and military spending, and the biggest driver of federal spending over the long term. Federal health spending is projected to eclipse the combined total of defense and non-defense discretionary spending by early in the next decade.
Medicare needs reform. Federal spending on the program has outstripped economic growth since the program’s inception and is projected to continue to do so in the future. Spending has grown and will continue to grow because of increases both in per capita spending and the number of beneficiaries. The program consumed roughly 2 percent of gross domestic product (GDP) in 2010, will approach 4 percent of GDP in 2020, and is projected to reach 6 percent of GDP by 2040. The program’s hospital trust fund, which is financed largely by payroll taxes, is projected to run dry in 2026.
Medicaid is the largest source of coverage for lower-income, vulnerable people. Over time, the program has enlarged, expanding its reach to ever-growing numbers of people. As a result, mounting fiscal, demographic, and structural challenges increasingly strain this jointly funded federal–state program. Tension between the federal government and the states over bearing program costs, a growing and diverse set of enrollees, and a delivery system that lags behind private coverage have put this program, and those dependent on it, at risk. Congress should reform Medicaid to make it fiscally sustainable and more effective in supporting pathways out of poverty.
Fact: The Left’s call to replace or augment our health care system with a government-controlled system would lead to fewer patient choices and more burdened doctors, and would fail to address critical problems.
Fact: The existing government regulatory and financing system has led to higher costs, reduced patient choices, and doctor demoralization.
Fact: Congress can lower premiums and increase choices through consumer-centered, market-driven reforms.
Since the Supreme Court’s 1973 Roe v. Wade and Doe v. Bolton decisions effectively legalized abortion on demand across the country, the pro-life movement has worked to reorient the hearts and minds of an entire generation toward the dignity and worth of every individual—born and unborn. As a result, many more Americans now identify as “pro-life,” and the vast majority of Americans believe that abortion should be significantly limited to, at most, the first trimester.
In state legislation, we have seen a trend toward recognizing the dignity of children and the mothers who carry them. More than 300 pro-life laws have been passed in states across the country in the past decade, including parental notification and informed consent laws, abortion clinic safety regulations, late-term abortion bans, and laws providing additional protections for infants who survive an abortion.
Thousands of community-based pregnancy resource centers have harnessed the best of the power and spirit of civil society, providing compassionate counseling, holistic support, and accurate information to women facing unplanned pregnancies.
Yet the challenges to life, conscience, and freedom that inevitably stem from court-sanctioned abortion on demand persist.
Seeing the success of pro-life legislation, well-funded and highly organized activist groups such as Planned Parenthood have helped to shepherd legislation through states such as New York that allows for abortion through virtually all nine months of pregnancy.
Respect for the dignity of life also requires resisting the recent push for widespread acceptance of physician-assisted suicide (PAS). Policymakers must realize that those who are suffering need true compassion and solidarity, and that doctors should be governed by the Hippocratic Oath and the admonishment to “do no harm,” and never assist in killing.
Policymakers should respect the intrinsic dignity of every human life and thus enshrine equal protection for all human beings in law, from conception to natural death.
Eliminate taxpayer funding for elective abortion here and abroad. There is long-standing, broad consensus that federal taxpayer funds should not be used for elective abortions or for health insurance that includes abortion coverage. Policymakers should close the patchwork of federal prohibitions on abortion funding by making policies such as the Hyde Amendment permanent across federal law. Lawmakers should likewise end the uncertainty over the Mexico City Policy executive order (now referred to as the Protecting Life in Global Health Assistance plan), which prohibits federal aid to international organizations that perform or promote abortions overseas. Because that policy has been susceptible to each Administration’s changing favor, Congress should enact permanent prohibitions on taxpayer funding of international abortion activity.
Redirect federal funding of Planned Parenthood to health centers not involved in abortion. During the 2017–2018 reporting year alone, Planned Parenthood affiliates performed more than 330,000 abortions, while the national organization reported over $245 million in excess revenue and held nearly $1.9 billion in net assets. During this same year, Planned Parenthood reports that its affiliates received over $560 million in government funding and over $630 million in private contributions. Planned Parenthood affiliates face accusations of waste, abuse, and potential fraud with taxpayer dollars, failure to report the sexual abuse of minor girls, and allegations of profiting from the sale of organs from aborted babies. Policymakers should end taxpayer funding of Planned Parenthood and all other abortion providers, and redirect funding to health centers without entanglement in abortion that provide health care for women.
Make pro-life policies a priority at the federal level. The Pain-Capable Unborn Child Protection Act,1 for example, would protect women and unborn children from gruesome late-term abortions performed after 20 weeks. Roughly half the states across the country have enacted similar bills. Similar policies are embodied in the Born-Alive Abortion Survivors Protection Act2 and the Dismemberment Abortion Ban Act,3 which prohibits an abortionist from dismembering a living unborn child in utero and extracting the baby’s body parts one piece at a time. Treating a baby who is born alive after a failed abortion with the same care that any other newborn baby would receive should not be a matter of controversy.
Stop Obamacare’s expansion of funding for abortion coverage. Obamacare made federal tax subsidies available for health care plans and contained other policies that resulted in greater taxpayer funding of abortion. In addition, Obamacare required almost all employers, including many religious nonprofits, to cover abortion-inducing drugs, contraception, and sterilization regardless of any religious or moral objections. Congress should repeal these policies and enact health care reforms that protect life and conscience and that do not subsidize abortion or abortion providers. Policymakers should enact permanent protections for the rights of individuals, religious organizations, and family businesses to keep them from being forced to enroll in or pay for coverage of life-ending drugs and devices.
Protect conscience rights of doctors, nurses, and other medical practitioners. Congress has rightly protected rights of conscience, based both on religious beliefs and on moral convictions, for over four decades. These protections allow for the expression of a diversity of values in health care while ensuring that individuals and entities are not compelled to participate in practices that violate their sincere moral, ethical, or religious convictions. But pro-life individuals and entities have limited recourse if this fundamental civil right is violated. The Conscience Protection Act,4 for example, would ensure robust enforcement of federal conscience protections and provide a private right of action to a party claiming to have been adversely affected by discrimination.
Resist the push for physician-assisted suicide (PAS). In the past two decades, there have been over 100 legislative proposals across the country to allow physician-assisted suicide. In the past year alone, California, Colorado, and the District of Columbia have legalized it. Legalizing PAS is a grave mistake that endangers the weak and vulnerable, corrupts the practice of medicine and the doctor–patient relationship, compromises the family and intergenerational commitments, and betrays human dignity and equality before the law. The experience of countries with PAS and euthanasia suggests that safeguards intended to limit PAS eligibility to the terminally ill or to certify autonomous consent often fail to ensure effective control. Instead of embracing PAS, policymakers should focus on the benefits of palliative care, which works to improve a patient’s quality of life by alleviating pain and other distressing symptoms of a serious illness.
Fact: Legalized abortion on demand has had a devastating impact on mothers, fathers, their unborn babies, and civil society.
Fact: The vast majority of Americans believe that abortion should be significantly restricted.
Fact: The abortion industry is well-funded, organized, and committed to expanding unlimited abortion at the expense of other services.
In 2017, the Supreme Court redefined marriage in Obergefell v. Hodges by ruling that same-sex couples have a fundamental right to marriage protected by the United States Constitution. Since then there has been a coordinated attack on both individuals and organizations who believe that marriage is between a man and a woman, and furthermore that sex is a biological fact, not a matter of self-perception.
In local, state, and federal laws, sexual orientation and gender identity (SOGI) ideology has been codified into state-sanctioned orthodoxy through the elevation of “sexual orientation” and “gender identity” into anti-discrimination law as protected classes. In the twenty-two states and hundreds of localities where these laws have passed, they have been used to punish dissenters from the new sexual ideology.1 This is no accident. Tim Gill, the man dubbed “the megadonor behind the LGBTQ rights movement” by Rolling Stone, disclosed that his goal is to pass SOGI laws in order “to punish the wicked,” those who disagree with him on marriage and sex differences.
The passage of these laws has spawned multi-state litigation against wedding vendors, endangered women and girls’ safety and privacy, undermined parental rights and the conscience rights of medical professionals, and violated religious freedom and freedom of speech.
Every human being has inherent dignity and should be treated with respect, including those who identify as LGBT. However, SOGI laws do not treat everyone with respect. They treat those who believe that marriage is between a man and a woman or that sex is a biological reality as the legal equivalent of racist bigots. However, this undermines what Justice Anthony Kennedy wrote in the Obergefell majority opinion itself: The traditional view of marriage, Kennedy said, “has been held—and continues to be held—in good faith by reasonable and sincere people here and throughout the world.” The Court also said that many “reach that conclusion based on decent and honorable religious or philosophical premises, and neither they nor their beliefs are disparaged here.” Unfortunately, SOGI laws are being used as a tool to do exactly that—disparage people who hold traditional beliefs.
Regular Americans face growing cultural, economic, and legal pressure to affirm the new sexual orthodoxy. Corporate America, celebrities, and the media aggressively promote SOGI laws and oppose religious freedom laws including by threatening boycotts. There are four common types of attack on religious freedom:
Increasingly, America is witnessing these attacks against those who do not conform to SOGI ideology. The Masterpiece Cakeshop v. Colorado Civil Rights Commission case provides an example of all four types of attack. A same-sex couple accused Colorado cake artist Jack Phillips of discrimination on the basis of sexual orientation under a state SOGI law when he declined to create a custom cake to celebrate their wedding. His case went all the way to the Supreme Court, which ruled in Phillips’ favor. But the Court left the SOGI law in question untouched. A transgender attorney has filed two new lawsuits against Phillips because he declined to create a “gender transition cake.” While the transgender attorney and the same-sex couple are free to live according to their beliefs on matters of sexuality, SOGI laws do not afford that same freedom to Jack Phillips. Instead, they are being used to compel him to celebrate ideas that violate his conscience.
The activists who attacked Jack Phillips pressured him to disavow his religious beliefs by launching an online campaign of harassment, making phone calls threatening to kill his family members, and filing a lawsuit against him. Colorado’s legal action against him led to a loss of 40 percent of the bakery’s income. Despite all four types of attack, Jack Phillips has remained firm in his convictions in the face of seven years of legal battles.
Policymakers should protect the freedom of all Americans to think, speak, and act according to the original understanding of marriage and the scientific definition of sex. Protecting the right to disagree on matters of sexuality will foster tolerance, authentic pluralism, and social stability. Enacting SOGI laws will foster needless litigation and further social division.
Support legislation that protects the freedom of all Americans, including both individuals and institutions, to think, speak, and act according to their belief that marriage is between a man and a woman and that there are only two sexes. Americans should be free at school, in the workplace, and in the public square to exercise their beliefs, whether they are moral, religious, or scientific beliefs.
The First Amendment Defense Act would prohibit the federal government from punishing any entity with which it contracts or which it accredits or licenses for the belief that marriage is between a man and a woman.
The Civil Rights Uniformity Act would state that for the purpose of existing federal civil rights laws, the word “sex” does not mean “gender identity” unless Congress specifically says so. This would prevent redefinition, by an agency of the executive branch, of existing civil rights laws, ensuring that unelected bureaucrats and judges cannot reshape policy affecting women and girls.
Provide faith-based foster care and adoption agencies with a permanent solution to ensure that they can continue to serve their communities. For faith-based agencies to continue to operate without threat of government interference, Congress should provide a permanent solution such as the Child Welfare Provider Inclusion Act.
Unilaterally oppose any federal bill that makes sexual orientation and gender identity protected classes and any appropriations bill that contains sexual orientation and/or gender identity language. A federal SOGI law like the Equality Act would have a devastating effect on average Americans. The President should promise to veto any such legislation. If SOGI language were to become a condition for federal funding or tax-exempt status, this would lead to infringement on religious freedom. Disqualification of any organization with moral or religious objections to the new sexual orthodoxy would cost the federal government some of its most effective partners in serving the public. In addition, bills like Fairness for All that add sexual orientation and gender as protected classes to civil rights law, but contain narrow religious exemptions to mitigate harm, are insufficient to protect the common good.2
At the UN (and in other international organizations), the U.S. should strengthen the protection of individual human rights and oppose creation of new rights based on SOGI. The U.S. should promote reform of the UN human rights bureaucracy and require adherence to its mandate to promote and protect fundamental freedoms. While LGBT people have all the same rights as other human beings, the UN should not be imposing LGBT ideology through the creation of new SOGI “rights.” The U.S. should respect the sovereignty of other UN member states in these matters and reject any insertion of SOGI language into negotiated UN texts.
Fact: Under state SOGI laws, individuals and organizations have faced lawsuits in various professions for acting in a manner that is consistent with their beliefs about sex and marriage, including:3
Fact: SOGI laws affect American life in a multitude of ways:
Fact: The majority of Americans believe that those who support traditional marriage and a biology-based understanding of sex should be free to live in a manner consistent with their beliefs.
Fact: Religious institutions contribute $1.2 trillion to the economy every year.7 An estimated 350,000 religious congregations operate countless schools, pregnancy resource centers, soup kitchens, drug addiction programs, and adoption agencies. These organizations serve 70 million Americans a year, and their services are valued at over $44.3 billion annually.8 SOGI laws would cripple their ability to serve.
Fact: There are 437,500 children in foster care.9
The COVID-19 pandemic brought about emergency changes to the welfare safety net in the spring of 2020. As the United States recovers from the crisis, the urgency of those initial responses must be matched by a commitment to return to fundamental principles in order to avoid increased long-term government dependence as a result of the emergency. This will require policymakers to set a course back to restoring policies aimed at work activation and return to the unfinished task of welfare reform across program areas.
When President Lyndon Johnson launched the War on Poverty, he said that it was intended to strike “at the causes, not just the consequences of poverty.” He added, “Our aim is not only to relieve the symptom of poverty, but to cure it and, above all, to prevent it.” Five decades and $29 trillion later, the welfare system has failed the poor. Progress toward self-sufficiency has stagnated, and the low-income family has collapsed.
Today, the government operates over 90 means-tested welfare programs that provide cash, food, housing, medical care, and social services to poor and lower-income Americans. Total federal, state, and local government spending on these programs now reaches over $1.1 trillion annually. Pouring dollars into an ever-increasing number of welfare programs has failed to improve rates of self-support. It is time to get welfare spending under control and to reform welfare to encourage self-reliance and improve the true well-being of the poor.
Properly account for welfare spending. The welfare system spends $1.1 trillion a year over 90 means-tested welfare programs that provide cash, food, housing, medical care, and social services to poor and lower-income Americans. These programs are scattered throughout multiple government agencies. The government does not provide accurate information about the benefits people receive. Policymakers should require that the President’s annual budget outline total current welfare spending, and be transparent about the typical benefit levels individuals receive. This recommendation is especially important in the wake of the policy response to the COVID-19 pandemic. Emergency spending should not become a building block to permanent expansions of welfare programs; fiscal discipline should be restored once the crisis is past.
Promote marriage as America’s greatest weapon against child poverty. The breakdown of marriage is one of the greatest drivers of child poverty. Marriage reduces the probability of child poverty by 80 percent. In contrast, children in single-parent homes are more than five times as likely to be poor compared to their peers in married-parent homes. Moreover, children raised outside a biological family arrangement are at greater risk of lower educational attainment, delinquency, non-marital pregnancy and childbearing, and other consequences. Tragically, more than 40 percent of all children today are born outside marriage each year, whereas in the 1960s, fewer than 10 percent of children were born to single women each year.
Unfortunately, government practices and policies undermine marriage despite its clear benefits. Of the nearly $400 billion in annual federal and state welfare funding spent on low-income families with children, three-quarters goes to those led by single parents. Moreover, the incentive structure of many federal welfare programs discourages single mothers from marrying the employed fathers of their children. Discouraging men and women from enjoying the financial and emotional supports of marriage in order to continue receiving public assistance harms adults and their children, who are more likely to continue the cycle of poverty for another generation.
Policymakers should reduce or eliminate the penalties for marriage in the welfare system. Additionally, leaders at every level of government should look for ways to educate young men and women, particularly in low-income communities, on the importance of marriage in reducing poverty and improving children’s well-being.
When the COVID-19 crisis has past, set a course to restore work activation policy and expand it to additional welfare programs. As a fundamental, long-term principle, welfare should not be a one-way handout. Instead, welfare should be based on reciprocal obligations between recipients and taxpayers. Government should support those who need assistance, and should expect recipients to engage in constructive activity in exchange for that assistance. Recipients who cannot find a job would be expected to engage in “work activation” including a supervised job search, training, and community service.
This idea of reciprocity between welfare recipients and society at large has nearly universal support among the public. Over 90 percent of the public agree that “able-bodied adults that receive cash, food, housing, and medical assistance should be required to work or prepare for work as a condition of receiving those government benefits.”
Establishing work requirements in welfare was the core principle of the welfare reform law enacted in the mid 1990s. That reform led to record drops in welfare dependence and child poverty. Employment among single mothers surged. This policy was effective in substantially reducing long-term child poverty through the great recession up to 2019. There is every reason to believe it will continue to be effective once the COVID-19 crisis is past. The crisis should not be the justification for overturning the fundamental principles of that reform.
Pay for outcomes, not services. Welfare programs should be made more efficient by paying for outcomes, rather than services provided. Roughly 10 percent of the federal government’s $1.1 trillion spending on welfare goes to programs aimed at improving human capabilities and changing behaviors in a positive direction. Examples include programs dealing with employment and training, child development, educational improvement, prisoner re-entry, drop-out prevention, and drug rehabilitation.
The government pays to provide these services rather than funding programs based on whether outcomes are achieved. Sadly, evaluations show that these social service programs rarely achieve significant positive outcomes. Under an outcome-based funding model, in contrast, payments would be made to service providers only when measurable positive outcomes are achieved for clients, including for example, reduced welfare dependence, increased employment, higher wages, increased high school completion, improved math and reading skills, reduced criminal activity and arrests, and decreased recidivism. If a service provider does not produce positive outcomes, it would not receive funding. This would automatically shift funds from failed providers to programs that work.
Restore the fiscal responsibility of state governments. Nearly 90 percent of cash, food, and housing aid to low-income persons comes from the federal government. (This figure does not include Social Security or Medicare.) State governments, which administer many federally funded welfare programs, have incrementally shifted fiscal responsibility for welfare to the federal government for decades. Because state governments have no financial “skin in the game” for most welfare programs, their administration is generally inefficient. States should gradually assume greater revenue responsibility for welfare programs; that is, they should pay for and administer the programs with state resources. A first step would be to gradually return fiscal responsibility for subsidized housing programs to the states.
Fact: Total spending at all levels of government on means-tested welfare programs is over $1.1 trillion annually, yet the government does not accurately present this information.
Fact: In 1992, candidate Bill Clinton promised to “end welfare as we know it”; since then, means-tested welfare spending has nearly tripled, after adjusting for inflation.
Fact: The Left’s proposed solutions—universal basic income and minimum wage increases—have a known track record of failure that hurts recipients and increases dependence on government.
Fact: The idea of reforming welfare to become a work activation program for able-bodied adults enjoys broad public support.
Fact: Children in single-parent homes are more than five times as likely to be poor compared to their peers in married-parent homes.
Agricultural policy does not merely affect farmers. It affects everyone because, after all, everyone eats. It is a broad, sweeping issue that affects Americans buying food for their families, and businesses that produce and distribute the food to consumers. Unfortunately, federal government intervention in the food and agricultural sector is far too prevalent.
One of the primary issues in agricultural policy is federal farm subsidies. There is a misconception that these subsidies primarily exist to help farmers when they experience crop losses—a “safety net” for major losses connected to natural disasters. Yet, the subsidies are instead an out-of-control corporate welfare system that primarily insulates a small number of large agricultural producers from competing in the marketplace. It is easy to see that agricultural producers can flourish without such harmful government intervention: Most U.S. agricultural producers, just like other businesses, do not receive special taxpayer handouts to help them compete.
Excessive federal intervention affecting food and agriculture does not end with farm subsidies. Recent trade disputes, such as those with China, have led to significant retaliatory tariffs on agricultural goods. This makes it more difficult for farmers to export their goods and reduces the selection of high-quality and low-cost food options for consumers.
Major environmental regulations trample on the property rights of farmers and ranchers and continue to hamper their ability to produce food (see the Environment chapter for more on these regulations). These regulations often reflect federal agency overreach that can block ordinary farming activities or discourage farmers from even trying to engage in such activities out of fear of civil and criminal penalties.
Increasing federal control over the food that people eat (even to the extent of hindering food innovation that would better meet consumer demand) is an alarming trend. Federal policymakers have taken steps to unduly influence or restrict personal dietary decisions, failing to respect the basic individual freedom of choosing what foods to eat. These harmful efforts reflect an arrogant assumption that federal bureaucrats know what people should eat, without regard for the complexity of diets and respect for individual choices, not bureaucratic preferences.
Too many policymakers simply defer agricultural policy to legislators serving on agriculture committees or to those with large farming constituencies. If the country is going to reduce this federal intervention, which distorts markets, wastes taxpayer dollars, and limits freedom, then all policymakers should take a proactive stand to promote the principles of free enterprise and limited government in agriculture.
Stop paying farmers twice for revenue and price losses in the same year. Agricultural producers can receive support from the Agricultural Risk Coverage (ARC) or Price Loss Coverage (PLC) programs and the federal crop insurance program to cover price declines and revenue shortfalls in the same year. In years in which farmers receive a crop insurance indemnity to help with revenue, the U.S. Department of Agriculture (USDA) should not also provide them an ARC or PLC payment. It is duplicative, unnecessary, and wasteful to force taxpayers to also provide those same producers with more than one federal revenue-related payment in the same year.
Reduce the premium subsidy rate for crop insurance from an average of 62 percent to 50 percent or lower. Taxpayers should not be paying more for the cost of premiums than the farmers who actually benefit from the crop insurance policies. Both the Trump Administration and the Obama Administration, as well as the Government Accountability Office, have all recommended reducing the premium subsidy. The Congressional Budget Office has identified reducing the premium subsidy to as low as 40 percent as an option to reduce the federal deficit. When analyzing a 47 percent premium subsidy, the Congressional Budget Office found that it would save taxpayers $8.1 billion over 10 years. It also would have very little impact on crop insurance participation. There would be a reduction in insured acres of just one-half of 1 percent and only 1.5 percent of acres would have lower coverage levels.
Eliminate the sugar program. The federal sugar program intentionally drives up food prices by limiting the sugar supply. As would be expected, American sugar prices are consistently higher than world prices, hurting American consumers and workers in industries that use sugar to manufacture goods. The program costs consumers about $3.7 billion a year, and there is a disproportionate impact on the poor because a greater share of their income goes to meeting food needs compared to higher income households. Sugar producers and processors should compete in a free market, as other businesses do, without price guarantees, supply restrictions, import quotas, and other government intervention.
Separate food stamps from agricultural programs. For decades, Congress has passed farm bills by combining food stamps with agricultural programs. This unholy alliance has existed entirely for political purposes to help push through legislation. The presumption is that rural legislators will push for farm subsidies and that urban legislators will push for food stamps. Separation is the prerequisite for real reform of agricultural policy because, like food stamps, agricultural policy needs to be addressed on its own merits. Congress should consider food stamps and agricultural programs in two separate bills, and the programs should be authorized on staggered schedules so that there is no potential for overlap in the future.
Free agricultural trade from government intervention. Trade is often discussed in connection with how it affects countries, but trade as a general matter is about the freedom of individuals and businesses to voluntarily exchange goods and services with customers. American farmers and ranchers, like other businesses, should be free to sell to customers all over the world. Further, consumers should be free to purchase goods and services that best meet their needs, regardless of national origin. Government-imposed barriers, such as tariffs, undermine these freedoms. To address unfair practices, the United States should use the World Trade Organization (WTO) dispute-settlement system instead of relying on tariffs. In fact, one of the most important benefits of the WTO is having a legal venue to challenge foreign trade barriers.
Stop federal efforts to control or change individual dietary choices. From Obamacare’s mandatory menu- labeling requirements to the U.S. Food and Drug Administration’s (FDA) de facto ban on artificial trans fats, federal government intrusion into the dietary choices of Americans is growing. Underlying these mandates is the arrogant presumption that individuals make misinformed choices, and that the government must therefore guide, or even compel, the public to make the “right” choices. Congress should respect that most basic and private aspect of Americans’ lives: food choices. This should include, for example, repealing the menu-labeling law, or at a minimum stopping the FDA’s overreach in its implementation. Even though the law applies to “restaurants and similar retail food establishments,” the FDA is using it to regulate grocery stores, convenience stores, movie theaters, and other businesses that no reasonable person would think are similar to restaurants. Congress should also clarify that the FDA’s role in food safety should not be conflated to mean that the agency’s safety responsibilities include nutrition.
Do not block innovation in the food and agricultural sector. Congress ignored the science when it mandated misleading food labels that suggest that food using genetically engineered crops is somehow less safe than non-genetically engineered counterparts. Efforts on both the state and the federal level (including at the FDA) are making it difficult for producers of new products such as plant-based alternatives to dairy products, and plant-based and cell-based alternatives to slaughtered meat, to accurately convey the nature of their products to consumers. For example, products such as almond milk, which have long used the term “milk” in the name to help inform consumers (and have had no problems with consumer confusion), might no longer be able to utilize the dairy-related term. Congress needs to repeal the genetically engineered food labeling law and should ensure that the government is not creating protectionist schemes, such as name restrictions, to hinder the sale and development of food products that appeal to consumers.
Fact: While agricultural special interests try to perpetuate the myth of the struggling small farmer in order to help justify government intervention, farm households in general are much better off than non-farm households.
Fact: Most farmers and most commodities receive very little to no subsidies, and if they do receive assistance, it is generally to help with actual crop losses.
Fact: For many American farmers and ranchers, agricultural trade is a necessity, since they produce more than they can sell domestically.
Human activity plays a role in a changing climate, as do a number of naturally occurring factors, but global warming is neither a planetary emergency nor does it necessitate massive, costly government programs to curtail energy use. The Intergovernmental Panel on Climate Change (IPCC) does not, for example, conclude that the world has until 2030 to avoid catastrophic global warming.1 Distinguishing what climatologists know, do not know, and might know is necessary so that objective, transparent science can inform public policy.
In fact, mainstream climate science does not comport with climate change alarmism. For instance, with regard to extreme weather events, the IPCC report and other published studies do not show trends for increased frequency or intensity of natural disasters. The IPCC notes in its most recent scientific assessment that “[n]o robust trends in annual numbers of tropical storms, hurricanes and major hurricanes counts have been identified over the past 100 years in the North Atlantic basin,” and that there are “no significant observed trends in global tropical cyclone frequency.” Further, “confidence in large scale changes in the intensity of extreme extratropical cyclones [such as “Superstorm” Sandy] since 1900 is low.”2 The National Oceanic and Atmospheric Administration clearly states that “[i]n terms of detection and attribution, much less is known about hurricane/tropical cyclone activity changes, compared to global temperature.”3
Moreover, the IPCC found evidence for increases, decreases, and no trend at all in flood activity or severity.4 Trends in local events like hail and thunderstorms were also inconclusive.5 Data for tornado activity in the U.S. show tornadoes occur no more frequently now than in the past and that the number of strong tornadoes (F3 and above) has actually decreased6 (after accounting for the apparent increase in tornado counts due to improved identifying technology). As for droughts, the IPCC overstated previous conclusions about increasing trends and stated that “the compelling arguments both for and against a significant increase in the land area experiencing drought has [sic] hampered global assessment.”7
Objective, transparent science should be an important tool to inform public policy. This is especially important as significant areas of disagreement remain among scientists about the nature and pace of warming. Independent efforts to more accurately determine the severity of climate change would help policymakers take any necessary cost-effective, verifiable, and effectual actions.
It is important to note that, regardless of the degree of urgency of combating climate change, proposed federal policies like cap and trade, a carbon tax, or regulations on power plants would be ineffective tools for doing so. According to the climatologists’ own models, the U.S. could completely eliminate its carbon dioxide emissions and still not abate much warming. Because the United States represents only a portion of global greenhouse gas emissions, the entire world would have to fundamentally change how it consumes energy to make any impact on global temperatures. But it would be pure fantasy to expect that developing countries would be willing to forego inexpensive and abundant carbon dioxide–emitting energy in favor of more expensive, intermittent sources. Developing countries are expanding their use of renewable power sources, but not to the extent that doing so will have any meaningful impact on global temperatures.
The costs of such aggressive policies would be significant and would leave Americans with fewer resources to combat current and future environmental challenges, whether climate related or otherwise. The goal of climate policies is to raise energy prices so that families and businesses use less energy and, consequently, reduce emissions. The direct impact of higher energy costs is just a small part of the story. Energy is a necessary input for nearly all goods and services. Consequently, Americans would pay more for food, health care, education, clothes—and every other good or service that requires energy to make and transport.
Climate policies also result in more government control over the lives of businesses and families. For instance, the Green New Deal proposes monumental changes to America’s electricity, transportation, manufacturing, and agricultural sectors to reduce greenhouse gas emissions. If enacted, the proposal would fundamentally change how people produce and consume energy, harvest crops, raise livestock, build homes, drive cars, and manufacture goods. Washington would make decisions on behalf of consumers and producers, and the costs would be borne by taxpayers. These policies would not only be incredibly costly, they would also have no impact on the climate and would strip freedoms from the American people.
Stop the regulation of greenhouse gases. The Obama Administration implemented a suite of greenhouse gas emissions regulations and executive orders that have unnecessarily driven up energy prices and eliminated choices, while having no meaningful climate impact. President Trump rightly directed agencies to reconsider and withdraw some of these rules. However, lasting leadership and change must come from Congress. Congress should prohibit the federal government from regulating greenhouse gas emissions and clarify that the Clean Air Act never intended to regulate greenhouse gases.
End the use of social cost of carbon in government cost-benefit analyses. Federal agencies perform cost–benefit analyses for a wide range of regulatory and permitting decisions. Under the Obama Administration, agencies began to incorporate a “social cost of carbon” in these analyses to assess the alleged social costs of an activity emitting carbon dioxide. The statistical models upon which the federal government relies offer significantly different results using other reasonable inputs, such that values are essentially arbitrary and are not credible tools for policymaking. Congress should prevent any agency from using regulatory analysis metrics with the “social cost of carbon” and the “social cost” of other greenhouse gas emissions in any cost–benefit analysis or environmental review. If federal courts force regulators into estimating the costs of climate change, they should assess climate impacts in terms of global temperature change as a result of the proposed project, using a tool like the Model for the Assessment of Greenhouse Gas Induced Climate Change rather than using the social cost of carbon.
Withdraw the endangerment finding and address the uncertainties in climate science. The Environmental Protection Agency (EPA) should reconsider its endangerment finding on greenhouse gas emissions, recognizing that greenhouse gas emissions are affecting the climate but that no credible evidence suggests that the Earth is heading toward catastrophic warming. Physicist Steven Koonin, former undersecretary of energy for science in the Obama Administration, proposed having a climate “Red Team/Blue Team.” Inspired by the national security community’s Red Team exercise to challenge assumptions, reduce risks and uncertainties, and correct for biases, a Red Team/Blue Team would provide a public, transparent exchange on major issues surrounding climate science.
Withdraw from the United Nations Framework Convention on Climate Change (UNFCCC). President Trump kept his campaign promise to withdraw from the Paris climate agreement, but has yet to outline details as to how the Administration will implement the withdrawal. The fastest and most effective way to withdraw from the Paris agreement is to withdraw from the entire UNFCCC, the treaty underlying the Paris agreement. Under the terms of the Paris agreement, any government withdrawing from the UNFCCC “shall be considered as also having withdrawn from this [Paris] Agreement.” The process for withdrawing from the UNFCCC requires one year, which accelerates the process considerably. Moreover, departure from the UNFCCC would prevent future Administrations from using that framework to avoid obtaining the Senate’s advice and consent in the treaty process. Congress should urge the Administration to withdraw from the UNFCCC.
Reject carbon taxes. Over 80 percent of energy resources used by Americans come from carbon-based resources. A carbon tax is a tax on energy and, in effect, on the entire economy. Levying a price on carbon dioxide would directly raise the cost of electricity, transportation, manufacturing, and nearly every good and service Americans engage in, and consequently would be regressive, hurting poor Americans—who spend a larger share of their income on energy—the most. Even if Congress were to implement a plan to give the revenue back to the people and avoid carving out revenue for special interests, which is unlikely, Americans stand to lose much more for all of the higher costs they would incur. Like every other regulatory or subsidy scheme to reduce carbon dioxide emissions, a carbon tax is by no means a free-market solution, nor would it provide any meaningful impact on global temperatures.
Make targeted spending decisions to build resilient infrastructure. Whether carbon dioxide levels rise, fall, or stay the same, the United States and the rest of the world will experience extreme weather events. Climate and land will continue to change for a wide variety of reasons. Without question, extreme weather and long-term climate changes can adversely affect communities and infrastructure. The federal government (when applicable), state and local governments, and the private sector should address climate-related infrastructure vulnerabilities through site- and situation-specific analysis and spending. Federal, state, and local policymakers should use the best available science to better prepare—before storms inflict damage—to maximize resiliency and preparedness.
Fact: Big government policies to slow global warming would have no meaningful impact on climate.
Fact: “The science is settled” and “97 percent of climatologists agree” are false talking points.
Fact: Climate policies would be costly, harming the poor the most.
The gross federal debt at more than $22 trillion dollars at the end of fiscal year 2019 exceeded the total size of the U.S. economy, gross domestic product (GDP), by 7 percent. Debt held by the public (that is, not including debt held in government trust funds such as Social Security and Medicare) was 79 percent of GDP at the end of 2019. In March 2020, the Congressional Budget Office (CBO) projected that debt held by the public would be 81 percent before September. Meanwhile, CBO also estimated that the debt would increase by over $14.4 trillion over the next 10 years.
However, a highly infectious and novel coronavirus, SARS-CoV-2, had spread to the United States from China. The first US case was detected in Washington State in late-January. By the middle of March, the virus was spreading to almost every state and, based on the advice of public health officials, businesses and individuals began to dramatically change their behavior. Around the same time, state and local governments began to implement public health tactics, such as stay-at-home orders and mandatory closures of non-essential businesses, intended to stop the spread of the virus. These actions had significant effects on the economy including a reduction in hours worked and business closures.
Congress passed a series of bills that significantly increased the deficit over a very short period of time in response to the increased demand for public health resources and economic fallout of the virus. At the same time, the administration released $50 billion in emergency funds. Furthermore, federal and state safety-net program spending increased as people have lost income by becoming unemployed or having their hours significantly reduced in response to the dramatic reduction in economic activity.
In April, CBO released an update to their March analysis projecting that the federal budget deficit will be $3.7 trillion in 2020. If no other legislative actions occur, debt held by the public is projected to exceed 100 percent of the economy by September.
Such high levels of debt are unprecedented. The immediate aftermath of World War II is the only time in American history that the debt has been this high. As the nation recovered from the war, so too did debt levels, which quickly stabilized and declined as a share of the economy for much of the next three decades.
However, current levels of debt are insufficient measures of whether a government’s fiscal policy is sustainable. This is because governments have a number of options for dealing with short-term debt increases including issuing new debt to pay for the interest on the existing debt. This is especially advantageous when the real interest rate on government debt is less than the rate of economic growth. In essence, the federal government can continue to rollover debt for some period of time without significantly increasing welfare costs associated with debt accumulation.
The point at which debt becomes so large that the federal government begins running out of tools to manage it is ultimately associated with whether the underlying fiscal policy is sustainable. Determining whether a particular fiscal policy is sustainable requires analyzing the extent to which the growth in spending will exceed the growth rate in the economy over a sustained period of time absent structural reforms. The problem with the US budget is that prior to the current novel coronavirus crisis there were a small subset of programs that were growing at unsustainable levels. However, these programs are also large and comprise more than 60 percent of total spending. The most significant challenges to the budget’s sustainability are the government funded health care programs, including Medicare, Medicaid, and spending on Obamacare. However, other entitlement programs also pose significant challenges absent reforms that align spending growth with that of the economy over the business cycle.
It is also possible that high levels of debt can result in a number of other adverse economic conditions. These include slower growth as well as the possibility for higher interest rates and inflation. Slower growth means less take-home pay for workers, fewer opportunities for Americans to improve their economic well-being and attain financial security, and lower revenue. Lower-income workers, minorities, and the elderly are hurt disproportionately in a weak economy. Inflation would affect Americans through higher prices on everyday goods and services. Higher interest rates would make obtaining a loan to start a business, purchase a car, or buy a house more expensive, putting dreams of homeownership and self-employment out of reach for many Americans.
In other words, high levels of debt could stifle economic opportunity and prosperity, making it harder for many Americans to live their version of the American dream.
Monetary policy enacted by the Federal Reserve has also been effective in blunting the real costs of debt. However, that does not reduce the threat. Rather, because people are less likely to experience the real costs of debt, they are also less likely to demand any structural reforms that would improve the government’s fiscal position. This will potentially increase the risk associated with high levels of debt making the eventual reforms that will be required much more significant.
It is past time for lawmakers to take the national debt and ever worsening fiscal situation seriously. The good news is that there is still time to make reforms. However, if Congress continues to ignore the problem, the negative effects of out-of-control spending will undermine financial security and economic opportunity for many Americans, and especially those of modest means.
Restrain spending with targeted reforms. Spending on Social Security, Medicare, Medicaid, and other health care programs is driving the federal budget to the edge of a cliff. CBO projects that spending for these programs will grow by an average of 2.7 percentage points faster than economy through 2030. There is no revenue-generating system in the world that would, in the long run, that would be able to finance entitlement programs that are by their design growing faster than the economy.
By 2041, CBO projects that spending on Social Security, healthcare, and interest payments on the debt will consume all federal revenues, necessitating massive tax increases to fund any other federal priorities such as national defense, absent reforms.
It will be impossible for America to dig out of this budget mess without addressing entitlement spending. There are reasonable policy options available that would modernize Social Security and healthcare programs to return control to Americans and expand their choices over health care and retirement decisions, while saving money. Lawmakers should make entitlement programs more affordable and fiscally sustainable by returning control over health and retirement decisions to the people.
Devolve inappropriate domestic programs to states, local governments, and the private sector. For at least the past 100 years, the federal government’s reach has expanded well beyond its constitutional requirements, leading to a more centralized government, stifling the creativity of states and localities, and pushing federal spending to unsustainable heights. In 2018 alone, state and local governments received more than $275 billion in grants from the federal government for programs unrelated to health care.
When Washington does allow states to administer their own programs, it acts as a pass-through, absorbing monies in the process and adding layers of bureaucracy. The federal government taxes families, takes a substantial administrative cut, and burdens the remaining revenues sent back to state and local governments with rules dictating how the money can be spent.
Rather than trying to be all things to all people, and not doing it very well, Congress should prioritize spending on the limited set of functions enumerated by America’s Founding Fathers within the Constitution. Mission creep and an overly expansive scope of federal activity undermines congressional and executive focus on performing core federal functions well. The COVID-19 crisis revealed core weaknesses including in public health agencies, such as the Centers for Disease Control, where program focus was diverted from protecting the nation against infectious diseases to the agency meddling in tangential areas, including obesity, smoking, alcohol consumption, and gun control, driven by political considerations.
Congress should cede most spending on highway, education, justice, and other domestic programs. Private entities and state and local governments are best able to manage such activities effectively and efficiently. Effective management requires having the freedom to target local programs to specific local needs and to serve those who need and value these services most. Government control of business activities also crowds out private sector funding and innovation and increases the likelihood that shielded entities will take unnecessary risks. After promising a healthy return on investment, government-owned and -subsidized businesses are frequently in the red, calling on taxpayers to repeatedly bail them out by way of more deficit spending.
Any government function that can easily be provided by state and local jurisdictions or businesses should be privatized, saving taxpayers’ money and providing Americans with better, more responsive, and more innovative services.
Reject tax increases. Some lawmakers have been quick to blame the Tax Cuts and Jobs Act of 2017 for the nation’s trillion-dollar deficits and mounting debt levels. To be clear, the unsustainable fiscal outlook currently facing America was created by unfunded spending promises put into law, in some cases, decades ago; not by too little taxes.
Lawmakers should reject attempts to raise taxes as a way to get out of the mounting debt crisis and focus on spending reforms instead. Over the next decade, the Congressional Budget Office projects revenues to be slightly above the 50-year average. However, CBO projects spending to be 2.5 percent of GDP higher than average, and to outpace revenues by more than 5 percent of GDP.
Closing the gap between revenue and spending would mean a significant tax increase on many Americans, but it is unlikely that higher tax rates on the highest income earners would significantly increase receipts. Instead, Americans could be faced with broad tax increases on middle- and lower-income earners. New taxes, especially on working and investing, would stifle the economic growth seen over the past several years and could make the debt crisis worse, not better.
Adopt an accountable, responsible, and transparent budget process. The 1974 Budget Act provides a timeline to guide completion of the congressional budget process and lays out clear deadlines to ensure that Congress enacts appropriations bills before October 1st of each fiscal year. The budget process allows Congress to evaluate priorities carefully and perform critical oversight over how agencies are spending taxpayer dollars.
However, Congress has no will and little incentive to follow the budget process. The last time that Congress actually completed each required step in the budget process on time was in 1996. The rules intended to keep the process running smoothly are weak and are all but ignored by both parties. This has led to a cycle of continuing resolutions, massive omnibus spending bills, and periodic lapses in appropriations. The budget and appropriations process has morphed from what was intended to be an orderly exercise into a continuing series of funding fights as Congress lurches from one crisis to the next. Amid this chaos, any semblance of fiscal restraint has been lost.
Furthermore, the budget process is weighed down by too many policy disagreements. The Presidents’ budgets and congressional budgets have evolved from governing fiscal plans into political messaging documents. They are rarely taken very seriously even though the federal bureaucracy spends a great deal of time on their preparation. As Alice Rivlin, the former director of both the Office of Management and Budget and the Congressional Budget Office, once wrote, “No government in the world devotes so much time, energy, and talent to budget decision making as our’s does.” And yet, what do taxpayers get from all of that budget preparation and evaluation?
The budget process cannot resolve every issue. And neither can the budget process adequately determine how the overall fiscal choices fit within the larger economic policy goals of the country. These goals should be established up front and debated in a similar manner to other policy. Fortunately, Congress and the administration already have a general process in place to conduct such an exercise through the annual preparation and consideration of the Economic Report of the President. That same infrastructure that was initially created by the Employment Act of 1946, including the US Congress Joint Economic Committee and President’s Council of Economic Advisors, should be used to formulate economic policy for the federal government. Once transparently established, that economic policy can be used to inform the development of the fiscal policy reflected within the budget documents.
Stop unauthorized appropriations. Congress should stop providing funding to unauthorized programs and agencies once and for all. Funding unauthorized programs is already prohibited through budget points of orders, but Congress does little to enforce these provisions. In FY 2019, Congress provided more than $340 billion to agencies and programs that had a lapsed authorization or had never been authorized at all. One potential solution would be to implement a sunset schedule for programs and agencies, as proposed by Rep. Cathy McMorris Rodgers (R–WA). The first year that a program continues unauthorized spending, it would be reduced by 10 percent of the previous year’s appropriation. For the next two years, it would be reduced by 15 percent. If Congress still failed to reauthorize the program by the end of the third year, the program would cease.
Eliminate budget gimmicks. Budget gimmicks promote wasteful spending and thrive on a lack of transparency. They should be eliminated from the budget process. One blatant gimmick, known as Changes in Mandatory Programs, creates false savings that Congress then uses to increase discretionary spending by billions of dollars. On top of Changes in Mandatory Programs, lawmakers allow adjustments for war and other spending that falls outside of statutory budget caps and is often diverted away from intended purposes, adding tens of billions of dollars in uncapped spending each year. Congress should budget for recurring expenses related to military and disaster aid within agencies’ base budgets. If additional spending is required, it should be reserved for truly unpredictable and widespread events. Americans deserve a full accounting of how much Congress is truly spending.
Remove baseline bias towards higher spending. Under current CBO scorekeeping rules, the baseline used to score discretionary spending proposals assumes that spending will increase at the rate of inflation each year. This creates two problems: First, it creates a bias toward higher spending levels. The CBO assumes that spending will increase based arbitrarily on inflation, not on actual agency needs or proposals. Second, it allows lawmakers to claim spending cuts relative to the baseline when spending is actually increasing when compared to levels that have not been adjusted for inflation. In other words, spending may still be increasing, just not at the same pace, as assumed inflation would otherwise have increased it.
Congress should reverse the bias toward higher spending and direct the CBO to remove the assumption that discretionary spending will increase with inflation from its baseline. Removing inflation from the discretionary baseline would eliminate one accounting gimmick from the budget process and make federal spending more transparent.
Provide fair-value estimates. In an effort to more accurately and comprehensively represent the costs and risks, Congress should incorporate market risk in subsidy cost estimates for federal credit and loan guarantee programs. Currently, only the estimated net costs of federal credit programs on an accrual basis, rather than the annual cash flows that happen during the period of a loan term, are accounted for in the budget baseline and for scorekeeping purposes. This downplays the tangible risk associated with certain loan guarantees, which is especially concerning during economic downturns.
Fair-value accounting more accurately presents the risks that Congress assumes through the subsidies that credit and loan guarantee programs provide. Providing fair-value estimates for these programs would allow lawmakers to make better informed cost-benefit decisions.
These modest reforms combined with a comprehensive framework for fiscal restraint would not only help America avoid a budget breakdown, they would also create a better, more transparent, and more accountable budget process.
Thousands of federal regulations have been eased as a result of the COVID-19 crisis to speed production of protective gear and development of treatment tools. This deregulatory sweep represents explicit acknowledgement that unnecessary regulation undermines public health and well-being. Economic recovery post-COVID-19 likewise requires Congress and the White House to lighten the regulatory burden on employers and investors.
President Donald Trump’s executive order of May 19, 2020, directs federal agencies to exercise regulatory restraint. But it will require action by Congress as well to ensure that meaningful reform outlasts the current Administration. Conventional wisdom has long held that government regulation is the only way to protect the public interest. We now know better: Forty years of command-and-control regulatory schemes have led to massive, ineffective, and unaccountable bureaucracies and a raft of costly unintended consequences.
Most regulatory intervention embodies the Progressive conceit that government knows what is best for us all. But even well-intentioned central planners cannot possibly possess the vast and ever-shifting knowledge necessary to determine the optimal course of action—especially when global markets are involved.
The self-interest of entrepreneurs and investors increases the likelihood of success. Consumers and competitors impose penalties for errors in judgment swiftly and stringently. In contrast, political imperatives trigger government action, which is largely insulated from consumer demand, competition, and financial discipline.
Government remedies are inherently weak because political concessions are necessary for them to gain acceptance. As economist Richard Stroup noted, “A political solution cannot be purchased—only rented.” Regulatory schemes are also unreliable because neither Congress nor the White House is bound by the actions of its predecessors, except in the granting or sale of private rights.
Regulations also shift labor and capital away from productive activities, such as innovation and job creation, to compliance activities. The burden falls heaviest on new businesses, which inhibits job creation, undermines competition, and secures the dominance of incumbent firms. Unsupportable compliance costs also drive mergers, further consolidating markets.
Regulatory costs are not a problem just for business. Low-income families and fixed-income seniors are also hit hard by government edicts. The costs of compliance increase the prices of products and services across the economy, including soaring energy bills from renewable energy dictates, increased food bills from excessive production standards, restricted access to credit due to some 400 Dodd–Frank regulations, and higher medical costs as a result of the inaptly named Affordable Care Act—to name a few.
Conservatives rarely shape the debate on environmental policy, too often focusing on regulatory costs rather than on an alternative agenda. But green eyeshades cannot compete for public support against the seemingly selfless agenda of green activists. Americans care deeply about the environment and expect public officials to act. Conservatives must avoid merely opposing the green lobby’s agenda and must put forth a platform for responsible stewardship. As noted in a previous Heritage report, Protecting the Environment: A Free Market Strategy, “While the conservative critique is well known, the conservative agenda is not.”
Reform is hindered by the immensity, complexity, and lethargy of the federal regulatory apparatus. A simple repeal requires adherence to a ream of administrative procedures, such as analyzing alternatives and presenting justification for public notice and comment. Litigation is rampant and protracted.
The need for reform has never been greater. Regulation acts as a stealth tax on the American people and the U.S. economy, and exacts an incalculable toll on individual liberty.
It is not enough to repeal individual rules or tweak the rulemaking process. A more substantive national debate must address the extent to which it is appropriate for the federal government (or any level of government) to intervene in matters that can be managed by the states and, in many instances, by the private sector, more effectively.
Permanently eliminate regulations that were waived as unnecessary during the COVID-19 crisis. There is no need to maintain red tape that interferes with the delivery of medical care and the health of the economy. The Administration and Congress should prioritize the repeal of rules deemed unnecessary in combating COVID-19.
Require congressional approval of new major regulations issued by agencies. Congress, not regulators, should make the laws and be accountable to the American people for the results. No major regulation should be allowed to take effect unless and until Congress explicitly approves it. In addition, legislators should include requirements for congressional approval of rules in every bill that expands or reauthorizes regulation.
Congress should set sunset dates for all major regulations. Rules should expire automatically if not explicitly reaffirmed by the relevant agency through the formal rulemaking process. As with any such regulatory decision, this reaffirmation would be subject to review by the courts.
Codify regulatory impact analysis requirements. All executive branch agencies are currently required to conduct regulatory impact analyses (including cost-benefit calculations) when proposing any new major rules. Codifying these requirements would ensure that they cannot be rolled back without congressional action, and provide the basis for judicial review of agency compliance.
Subject independent agencies to executive branch regulatory review. Rulemaking is increasingly being conducted by independent agencies outside the direct control of the White House. Regulations issued by agencies such as the Federal Communications Commission, the Security and Exchange Commission, and the Consumer Financial Protection Bureau are not subject to review by the Office of Information and Regulatory Affairs (OIRA) or even required to undergo a cost-benefit analysis. This is a gaping loophole in the rulemaking process. These agencies should be fully subject to the same regulatory review requirements as those to which executive branch agencies are subject.
Increase professional staff levels within OIRA. OIRA is one of the only government entities in Washington that is charged with limiting, rather than producing, red tape. More resources should be focused on OIRA’s regulatory review function. This should be done at no additional cost to taxpayers: The necessary funding should come from cuts in the budgets of regulatory agencies.
Require agencies to base decisions on factual data, and to disclose any such data for public review. Federal agencies routinely mask politically driven regulations as scientifically based imperatives. The supposed science underlying these rules is often hidden from the public and unavailable for vetting by experts. Credible science and transparency are necessary elements of sound policy.
Fact: Total regulatory costs are commonly estimated to exceed $2 trillion annually (although there is no official tracking).
Fact: Private sector regulatory costs increased by an astonishing $122 billion annually during the Obama Administration, according to analyses by Heritage experts.
Fact: Regulatory costs have increased by 97 percent since the year 2000.
Fact: The United States is currently ranked as only “Mostly Free” in The Heritage Foundation’s Index of Economic Freedom.
Fact: Excessive regulation stunted average GDP growth by 0.8 percent annually since 1980, according to a 2017 report by the White House Council of Economic Advisors.
Fact: Five of the six richest counties in the United States ring Washington, D.C., which may demonstrate that the greater government interference grows, the more essential political influence becomes.
Energy is essential to nearly every product and service Americans use and to every activity in which they engage. Whether with electricity, energy technologies, or fuels, energy heats homes and meals, runs schools and hospitals, powers businesses that create jobs, and fuels vehicles that connect people with products that use energy resources as basic feedstock—products as wide-ranging as cosmetics, athletic equipment, pharmaceuticals, paints, and pipelines. Affordable, reliable energy is worth continuing to strive for and should be enjoyed unapologetically.
Perhaps because energy is so intertwined with the economy, politicians routinely meddle in energy markets to micromanage for preferred outcomes. Big government approaches to energy policy aim to centrally plan, actively manage, and pre-condition energy choices in order to serve political agendas. Unnecessarily burdensome laws and regulations have driven up energy costs, reduced those choices, and opened the door to cronyism.
Subsidies through the tax code, grants, guaranteed market share, loans and loan guarantees, and government-funded research and development have become popular ways to implement energy policy. This has wasted billions of taxpayer dollars and distorted private sector investments. Politicians, bureaucrats, and companies with effective lobbying arms not infrequently also use the regulatory process to block access to some resources and technologies or hedge out competitors.
While subsidies may appear to benefit the recipients, advantages are short term at best. When government insulates technologies or certain companies from the prospect of failure or competition, it removes healthy forces that drive creativity and solutions in the long term. Government subsidies also create barriers to entry for innovative, unsubsidized energy companies that must compete for customers against companies backed by the government and U.S. taxpayers. Further, although government experts might appear to know how best to plan energy resources and use for the future, they are often wrong, slow to adapt, and incapable of complete knowledge of a dynamic global sector. Indeed, almost no one anticipated the oil and gas boom in America created by hydraulic fracking, which has fundamentally transformed global energy markets.
Relying on free enterprise and the private sector’s ability to innovate to meet America’s diverse energy needs is a far better approach. Fuel and technology-neutral competitive markets allow prices to communicate accurate information to producers and customers about the value and cost of energy. This allows the endless creativity of people to anticipate and meet customer energy needs and preferences. Ultimately, competition to meet consumer preference in energy services empowers American families and businesses, rather than bureaucrats, lobbyists, and politicians, to make decisions. Congress should focus on reducing ineffective and economically harmful regulations, opening access to resource development, and eliminating subsidies for all energy resources.
Stop the regulation of greenhouse gases. The Obama Administration implemented a suite of greenhouse gas emissions executive orders and regulations under the Clean Air Act1 that have unnecessarily driven up energy prices and eliminated choices, while having no meaningful climate impact. President Trump rightly directed agencies to reconsider and withdraw some of these rules. However, lasting leadership and change must come from Congress. Congress should prohibit the federal government from regulating greenhouse gas emissions and clarify that the Clean Air Act never intended to regulate greenhouse gases.
End use of social cost of carbon in government cost–benefit analyses. Federal agencies perform cost–benefit analyses for a wide range of regulatory and permitting decisions. Under the Obama Administration, agencies began to incorporate a “social cost of carbon” in these analyses to assess the alleged social costs of an activity emitting carbon dioxide. The statistical models upon which the federal government relies offer significantly different results using other reasonable inputs, such that values are essentially arbitrary and are not credible tools for policymaking. Congress should prevent any agency from using regulatory analysis metrics with the “social cost of carbon” and the “social cost” of other greenhouse gas emissions in any cost–benefit analysis or environmental review. If federal courts force regulators into estimating the costs of climate change, they should assess climate impacts in terms of global temperature change as a result of the proposed project using a tool like the Model for the Assessment of Greenhouse-gas Induced Climate Change rather than using the social cost of carbon.
Eliminate subsidies for all energy resources and technologies. In 2015, Republicans and Democrats reached a compromise to extend wind and solar tax credits one more time and put them on a schedule to sunset. Congress should hold to that promise and wind down tax credits for all energy technologies. It should also reform the tax code to allow for immediate expensing for all capital investments. Relatedly, Congress should eliminate Department of Energy (DOE) subsidized research and development for commercial energy technologies. It is neither appropriate for taxpayers nor a necessary role of the federal government to fund or conduct such research. Furthermore, Congress should prohibit any further taxpayer-backed loans to private companies and eliminate the DOE’s loan-guarantee program.
Reform offshore energy leasing. America keeps the vast majority of its territorial waters off-limits to energy production, but that has not always been the case. Congress should open America’s coasts for offshore oil, gas, wind, and other energy resource exploration and development. It should eliminate the Department of Interior’s five-year leasing plans and authorize the Department of the Interior (DOI) to conduct lease sales, if interest for development exists, while considering the interests of states that would be most impacted by that development. Such a reform would allow the safe development of energy off America’s coasts and replace the lengthy and unnecessary planning process for a system that is more responsive both to price changes and to the needs and interests of states. Bidding on the leases would not be exclusive to energy companies but open to all parties, including those interested in environmental preservation rather than resource development. Reform should also include transferring environmental review and permitting process to the states, along with at least 50 percent of the revenues generated by onshore oil and natural gas production on federal lands.
Eliminate government energy efficiency mandates. Federal efficiency mandates, rebate programs, and spending initiatives too often assume either that all Americans use energy the same way, or that the government knows better how Americans should use energy. Congress should affirm the ability and freedom of Americans and businesses to make decisions that best meet their needs by eliminating all mandatory efficiency regulations and subsidies for vehicles, appliances, and buildings. At a minimum, mandates should be restructured as voluntary standards under which businesses and consumers can choose their level of participation.
Overhaul nuclear energy regulation. The regulatory system that licenses and permits nuclear reactors failed to keep up with technological innovations and overregulates existing nuclear technologies. Instead of addressing underlying government-imposed problems, policymakers have focused on mitigating the cost of those policies through subsidies, leading to a predictable path of failure: While such an approach may spur some commercial activity, that commercial activity is limited only to what is subsidized. Nuclear plants in America today continue to exhibit superior safety performance. Policy and regulations should reflect that track record. Congress should instill regulatory discipline at the Nuclear Regulatory Commission (NRC), direct the Environmental Protection Agency to right-size radiation-exposure standards, review foreign ownership caps, reform the NRC’s cost-recovery structure, and address the convoluted export regulatory regime.
Complete the review of Yucca Mountain, and introduce market forces into nuclear waste management. Congress has failed either to change current law or appropriate the funds necessary for the NRC to review the DOE’s permit for a nuclear waste repository at Yucca Mountain. This unnecessary limbo has been costly to taxpayers and has created problematic uncertainty for the current and future nuclear industry. Congress should provide enough funding to complete the license review to allow contentions to be adjudicated, and all of the information should be brought together for Congress, the State of Nevada, and the nuclear industry to make prudent decisions about next steps. Ultimately, Congress must introduce market forces in nuclear waste management for it to be a successful, dynamic part of the fuel cycle and nuclear industry. Nuclear waste management should be primarily a business activity, not an inherently governmental activity.
Encourage choice in electricity markets. Competitive electricity markets have served customers well. Some states have accomplished the transition from monopolies to competition more successfully than others, and additional free-market reforms are necessary to spur more entrepreneurial activity in electricity markets. However, when the underlying structure of competition is sound, the benefits to energy consumers are unambiguously positive. Competition in electricity services allows greater customer choice through the power of the consumers’ own dollars rather than through the disconnected votes of a small panel of public utility commissioners. Consumer choice comes not only in the form of resource choice (renewables, conventional fuels, or a mix) but also in the form of financial choices (e.g., fixed rates, risk preferences, indexed rates, or short-term or long-term contracts).
In the end, because electricity providers have to work for their customers, prices are competitive and quality improves. States should fix anti-competitive energy policies like renewable energy mandates, which have wreaked havoc in the electricity sector by putting politics and special interests over customers. Similarly, the Federal Energy Regulatory Commission should work vigorously to uphold fuel and technology neutral competition in electricity markets.
Repeal the Renewable Fuel Standard (RFS). There is near universal agreement among energy, agriculture, food industry, and environmental groups that the RFS is bad policy and that it has had negative unintended consequences. Despite nearing the goal of the mandate to use 36 billion gallons of ethanol by 2022, this policy has proved unworkable. Tinkering around the edges will not rescue it. Moreover, the federal government should not mandate what type of fuel drivers use in the first place. Instead of attempting to reform the RFS, or continually calling on the EPA to waive or negotiate annual mandates, Congress should repeal the RFS to protect Americans from artificially higher food and energy prices, and eliminate unfair subsidies that go to a small set of special interests that benefit from the mandate.
Fact: Energy subsidies waste taxpayer money and actively prevent innovative energy technologies from thriving in the market.
Fact: 80 percent of energy consumed by American families and businesses came from coal, oil, and natural gas.
Fact: Competition has been good for the nuclear industry; however, the industry is over-regulated and faces significant government-induced risk.
Fact: Renewable energy technologies supply a growing share of electricity; however, government intervention hides costs and harms competitiveness.
America’s major entitlement programs—Social Security, Medicare, Medicaid, and Obamacare—provide income and health care benefits to older Americans as well as middle- and lower-income individuals and families. Those benefits come at an extreme cost, however, to current and future Americans and their families because these entitlement programs strip people of opportunity and autonomy, cost more than is necessary or prudent, and shift current costs onto younger and future workers—and in the case of Medicaid and Obamacare, lock beneficiaries into government-dictated care that too often has much too limited options for the sick.
Entitlement programs take money from taxpayers that they could otherwise use or save according to what works best for them and their families. Instead, that money goes to programs that provide restricted, government-prescribed benefits. For example, Social Security’s Disability Insurance program requires workers to spend more than a year, on average, navigating a burdensome application process before receiving a final approval or denial of benefits. In Medicare, Medicaid, and Obamacare, the financing schemes limit choices and access by dictating government-approved benefits and blocking alternative coverage arrangements. Meanwhile, Social Security’s taxes prevent workers from maximizing their savings over their lifetime for purposes like buying a home, saving for a child’s college education, or paying for living expenses during a period of unemployment. And Obamacare gives more taxpayer money to insurance companies—dollar for dollar—every time they raise prices, a recipe for higher costs.
In addition to limiting choices, entitlement programs drive up costs. Pay-as-you-go entitlement programs, like Social Security, that use current workers’ payroll taxes to fund retirees’ benefits strip workers of the opportunity to earn a positive return on their savings. Consequently, the average retiree could receive two to three times as much by saving on their own versus having their money go into Social Security.
One of the reasons America’s entitlements are so popular is because recipients receive far more from them than they pay in—about 2.5 times as much, on average. If workers had to pay the true cost of the benefits they receive, few would be willing to sacrifice nearly 40 cents of every dollar they earn.1 (The nearly 40 percent suggested payroll tax comes from multiplying the current 15.3 percent tax times the 2.5 ratio of taxes paid to benefits received to get a 38.25 percent, or “nearly 40 percent,” tax rate.) Instead, all those extra costs have been piling up, creating a $445,000 debt (including just Social Security and Medicare) to be unloaded on every worker when America’s day of debt reckoning comes.2
America’s entitlement programs have value as social safety nets, but they have grown far beyond that purpose by providing excess benefits to individuals who are capable of providing for their own health care and retirement needs. America’s entitlement systems should return to their original intent of protecting America’s most vulnerable while giving individuals greater control and ownership of their health care and financial well-being.
Preserve Social Security for the most vulnerable while restoring to workers more control over their own money. Social Security started out as an old-age social insurance program intended to protect a relatively small number of elderly individuals from living in poverty. Over the decades, however, it has massively expanded in size, scope, and cost, to the point that two out of every three Americans pay more in Social Security taxes than they do in income taxes,3 and 42 percent of Americans rely on Social Security for at least half of their retirement income.4
Social Security’s more than five-fold increase in taxes and its dominant role in Americans’ plans for retirement income leave workers with less control and lower incomes than they otherwise would have. Moreover, the program’s insolvency—resulting in significant benefit cuts beginning in 2035—threatens workers’ retirement security.
To ensure that Social Security is there for workers who need it and to increase workers’ incomes both before and during retirement, the program should have an eligibility age that reflects rising life expectancies and increased work capabilities. Benefits should better target workers’ needs by shifting to a predictable, poverty-prevention, and modernized benefit structure. And Social Security should apply a more accurate inflation measure to annual benefit increases. These changes would make the program solvent over the long run, and would allow for a significant reduction in workers’ payroll taxes, enabling workers to spend, save, and invest more of their own money.
Improve Social Security’s Disability Insurance (SSDI) program to better serve individuals with disabilities while ensuring efficiency and integrity for taxpayers. The SSDI program has served as a lifeline for certain individuals with disabilities, but its ten-fold expansion in size and scope between 1970 and 2015 produced inefficiencies and inadequacies such that it fails to meet workers’ basic needs on a timely basis.5 Due to inefficient and flawed government policies, individuals who receive SSDI benefits wait well over a year, on average, to learn if they qualify to receive SSDI benefits and receive no support to help them remain at work or get back to work. Those who do receive SSDI benefits face a lifetime of inactivity and government dependence (leading to lower physical, mental, and financial well-being than if they had pursued meaningful work); and nearly a third of SSDI beneficiaries receive lower than poverty-level benefits.
A rehabilitated and modernized SSDI system would promote independence and physical and mental well-being by helping individuals with disabilities receive the assistance they need when they need it, and with less stigma and cynicism associated with receiving SSDI benefits. This type of system could be achieved by implementing a predictable, poverty-prevention benefit; providing a needs-based benefit period; eliminating non-medical vocational grid factors; providing an optional private disability insurance component; ending direct payment of SSDI representatives; correcting unintended payments; and improving program integrity and efficiency.
These changes would improve the SSDI program for individuals with disabilities, and they would save taxpayer costs by significantly reducing the payroll tax rate, enabling workers to buy more generous private insurance to better meet their needs and to spend, save, and invest more of their own earnings.
Improve Medicare’s quality of care for a rapidly aging senior population while retargeting taxpayer subsidies to those most in need. Medicare, created in 1965, provides seniors and some people with disabilities a guaranteed health care benefit. Over the past 50 years, although it has delivered hospital and physician services and some financial security, Medicare spending routinely has outpaced inflation, growth in the general economy, and growth in the federal budget. Meanwhile, the addition of new benefits and services has been accompanied by increasingly detailed conditions of reimbursement that have led to more intrusive bureaucracy and costly red tape for doctors, hospitals, and other medical professionals. These changing dynamics in Medicare leave seniors, health care providers, and taxpayers at risk.
To improve the delivery of care in Medicare, ensure seniors have access to quality care, and protect taxpayers from bankrupting costs, a number of changes should be made: Simplify the traditional Medicare program, harmonize eligibility with Social Security, update premiums and cost sharing arrangements, expand on the success of the competitive and integrated Medicare Advantage plans, and finally, transition to a defined contribution, premium support model for long-term sustainability.
Restore Medicaid’s strong healthcare safety net to the most vulnerable while ensuring financial sustainability. Enacted alongside Medicare in 1965, the Medicaid program began as a safety net to provide certain vulnerable low-income populations with heath care. Like Medicare, the program has expanded beyond its original core functions, providing additional benefits to larger populations at a significant cost to federal and state taxpayers. The joint federal–state design of the program further complicates the administration and oversight of the program, creating new and disparate sets of incentives and outcomes. Changing demographic, structural, and fiscal challenges undermine this critical safety net program.
Restoring Medicaid to a functioning safety net would require a major overhaul of its financing structure in order to realign and reset priorities and incentives for those who need the program the most. Specifically, the financing of the program should be sustainable and realistic, and it should be based on the needs of different populations, while greater flexibility should be granted to states to better manage the delivery of care to those in need.
Replace Obamacare in order to expand health care choices and access, while lowering cost. The 2010 Affordable Care Act put in place two new federal health care entitlements and a massive federal regulatory infrastructure, financed by an unrealistic set of new taxes and payment cuts to providers in other health care programs. Since its enactment, premiums have climbed, coverage options have dropped, provider networks have narrowed, and many people are left with higher costs, less access, and fewer choices. Moreover, the open-ended ACA subsidies scheme and the ACA Medicaid expansion encourage more spending rather than demanding better value.
To turn the tide, fundamental changes need to be made to restore choice, improve access, and lower costs. Under a new framework, existing federal funding for Obamacare would be replaced with a fixed grant to the states with the regulatory flexibility to reverse the harmful effects to the insurance markets. Rather than receive government assigned coverage, individuals would have the choice of a wider range of private coverage options to best meet their needs and the needs of their families.
Fact: Social Security is a bad deal.
Fact: Disability insurance fails individuals and taxpayers through inefficiencies, a lack of integrity, and a poorly-targeted benefit structure.
Fact: A rapidly aging senior population and growing costs threaten Medicare’s future.
Fact: Medicaid faces demographic, structural, and fiscal challenges that threaten its future sustainability.
Fact: Obamacare has led to higher healthcare costs and fewer healthcare choices.
Americans, regardless of ideology, want a clean environment. However, the path to achieving environmental objectives leads to disagreement. While some look to the federal government to promote command and control policies, the best approach to environmental policy is to recognize the importance of private property rights, state and local innovation, and free markets.
Command and control advocates invariably point to federal laws, such as the Clean Air Act, as examples of success. While the Clean Air Act has certainly played an important role in the drastic improvements seen in air quality over the past 40 years, the improvements could have been accomplished at far less cost—both economic and social—had lawmakers foregone centralized government control in favor of the transformative power of market incentives and private property rights.
Touting the Clean Air Act as an example of the success of command and control policy also ignores other foundational environmental statutes from the 1970s that have failed miserably, including the Endangered Species Act. In addition, the state of our air and water has improved by leaps and bounds over the past several decades through innovation and investment in new technologies. For policymakers, the question should not be what laws such as the Clean Air Act have done in the past, but whether these laws are sound policy for the future.
Unfortunately, federal environmental law is comprised of environmental statutes that are overly broad, unclear, or woefully outdated, failing to reflect current conditions. In addition, close to 50 years of agency implementation of these laws has led to government overreach inconsistent with the statutes themselves.
The federal government’s role in environmental management has grown in size and scope well beyond what was envisioned with these statutes, even as the federal government has become increasingly unaccountable to the people and their representatives in Congress. Congress delegated much of its power to set environmental policy to executive agencies, which they do through standards, regulations, permitting requirements, and multi-decade management plans. And while Congress envisioned a cooperative role for states in many of these laws, that role has been eroded over time. Consequently, federal bureaucrats often function as economic planners and local zoning boards.
The result is sweeping decisions to nuanced issues and increasingly stringent standards that achieve marginal benefits at great cost. Often these decisions are defended by scientific analyses that present an incomplete picture, are biased toward regulatory action, ignore evidence that contradicts regulatory agendas, and are inaccessible to the public. While regulators argue they are merely “following the science,” they are actually making policy decisions that reflect their own value judgments.
Even in areas where most Americans would support some measure of continued federal management, current policies are problematic when divorced from principles of limited government, individual freedom, and free market incentives. National parks are discouraged from employing innovative solutions to raise park revenue, address catastrophic wildfires, and manage invasive species and overpopulation of native species. Laws like the Endangered Species Act disincentivize solutions and partnerships with private property owners. Perhaps the greatest environmental liability still to be addressed in America—government nuclear weapons research and development sites that helped the U.S. win WWII and the Cold War—has yet to be cleaned up as a result of bureaucratic and legislative mismanagement.
The need to reform the nation’s environmental laws has never been greater. The foundational federal environmental statutes should be changed to apply the lessons learned over the past half-century. The statutes should be modernized to reflect the current environment and to rein in the agency overreach that has expanded its scope beyond the plain language of the statutes and the will of Congress.
In general, to the extent that there is a federal role, it should be to ensure that environmental gains achieved over the years are not lost. The responsibilities and the rewards of environmental stewardship belong with property owners and the states, which are more knowledgeable about local conditions than federal bureaucrats.
A true commitment to the environment means advancing policies that achieve measurable, positive outcomes. The best way to achieve these outcomes is by respecting American values of federalism, the rule of law, and economic freedom. Ultimately, policymakers should never lose sight of the fact that people are the most important, unique, and precious natural resource.
Devolve more responsibility for environmental regulation and federal lands management to the states and the private sector. Congress should allow state programs to function in place of federal leasing, permitting, management, and regulatory programs. Doing so would employ local knowledge and relieve federal budgets of the burden of managing permitting requests and regulatory responsibilities, freeing up federal resources for issues more federal in nature. Further, America benefits from experimentation and innovation that could be cultivated with a more decentralized approach. Some states would make mistakes in their management, by being either too restrictive or too lax, but such mistakes would provide lessons to guide future policy decisions and would have far less adverse impact on the nation than if the same mistakes were made by the federal government.
Prohibit the EPA from abusing cost–benefit analysis to justify costly air regulations (ancillary or secondary benefits abuse). When the EPA issues a rule to reduce emissions of a certain air pollutant, the direct benefits of reducing those emissions should exceed the costs. However, for years, the EPA has used an improper end run around this commonsense requirement. Even when the rule’s stated objective has massive costs and few to no benefits, the EPA points to the ancillary benefits of reducing particulate matter as justification for the rule. This overreliance on ancillary benefits allows the EPA to regulate a pollutant without making the case that reducing emissions of that pollutant is warranted. This abuse has become so egregious that the EPA has issued major rules without quantifying whether there are benefits associated with their regulatory objectives, instead relying solely or primarily on ancillary benefits from reducing particulate matter.
Clean up facilities used to manufacture and test nuclear weapons. Perhaps the greatest remaining environmental liability in America is those facilities remaining from World War II and the Cold War that were used to manufacture and test nuclear weapons. The Department of Energy (DOE) is chiefly responsible for cleaning up these sites, which is currently expected to cost taxpayers $377 billion. While the DOE recently took steps to address some unnecessarily burdensome bureaucracy, it has not met annual progress- and cost-reporting requirements to Congress. Cleanup of these sites should not be treated as an everlasting jobs program. The federal government has a legal and moral obligation to clean up these sites, a mission which should have the commensurate level of attention from Congress.
Define the waters covered under the Clean Water Act. Congress should clarify in statute the regulatory reach of the Clean Water Act. The statute currently prohibits discharge, without a federal permit, of pollutants into “navigable waters.” It further clarifies that “navigable waters” include “the waters of the United States, including the territorial seas.” However, the Environmental Protection Agency (EPA) and the Army Corps of Engineers have failed to follow the plain language of the law and tried to expand their regulatory reach by broadly defining “waters of the United States.” They have also adopted subjective and vague definitions, while inconsistently enforcing the law. While these agencies, to their credit, recently proposed a narrower definition, Congress should provide the definition of what waters are covered under the Clean Water Act, recognizing the important role states play in regulating lakes, rivers, and streams. This definition should be narrow in scope and generally consistent with Justice Scalia’s plurality opinion in Rapanos v. United States (2006).
Eliminate the Land and Water Conservation Fund. The Land and Water Conservation Fund (LWCF), established by Congress in 1965 and part of the U.S. Department of the Interior, allows the federal government to use royalties from offshore energy development to buy private land and turn it into public parks and other public recreation areas. It is the primary vehicle for land purchases by the four major federal land-management agencies: the Forest Service, the Bureau of Land Management, the Fish and Wildlife Service, and the National Park Service. Congress also uses the fund for a matching state grant program, although in practice the LWCF has chiefly funded federal objectives. The federal government cannot effectively manage the lands it already owns, and Congress should not enable further land acquisition. Of the $40 billion credited to the fund, less than half ($18.4 billion) has been spent, leaving a credit of $21.6 billion. Congress should rescind the remaining balance.
Improve the Endangered Species Act. The Endangered Species Act (ESA) is failing at its fundamental purpose to protect endangered or threatened species, and, making matters worse, this failure is exacerbated by blocking important projects and trampling on property rights. To better help conserve species under the ESA, Congress should codify the regulatory clarification (consistent with the statute) that threatened and endangered species are to be treated differently when it comes to the take prohibition. The listing process should be a distinct process that is separate from whether any regulatory requirements should be triggered. States should be allowed to play a greater role in protecting species, in large part because they are closer than the federal government to any situation that needs to be addressed. Improvements to the statute should ensure that the costs of the ESA are not borne by individual property owners, but by society as a whole.
Require Congress to make any changes to the National Ambient Air Quality Standards. The EPA regularly sets standards for six principal air pollutants: carbon monoxide, lead, nitrogen dioxide, ground level ozone, particulate matter, and sulfur dioxide. Under the Clean Air Act, the EPA is required to review the standards every five years and make changes, if necessary, disregarding costs in the development of the standards. The EPA continues to develop stricter standards even as states and metropolitan areas have yet to meet older standards (for example, in the case of ground level ozone). New standards are also becoming extremely expensive to meet while yielding smaller margins of tangible benefits; in fact, some standards are close to or at background levels. Congress should reconsider the mandatory review process. Congress, not the EPA, should make any decision to tighten standards, given the scope of their impact and the magnitude of success that has already been achieved in improving air quality.
Repeal or limit the scope of the National Environmental Policy Act. The National Environmental Policy Act (NEPA) is a 50-year old procedural law that requires federal agencies to assess the potential environmental impacts of their actions, including permitting for infrastructure projects. NEPA has evolved to serve more as a tool to delay and obstruct projects unpopular with special interest groups or politicians than as a way to properly consider environmental impacts. Major problems contributing to NEPA delays include: differing interpretations of NEPA requirements, nuisance litigation, failed interagency coordination, administrative bottlenecks, and outdated requirements that fail to take into account a dynamic environment.
Far from compromising environmental stewardship, repealing NEPA would provide an opportunity to remove duplication of state and federal environmental requirements. NEPA was the first major federal environmental law in the United States and was passed before the numerous federal environmental statutes that now exist. It seems unlikely that NEPA would even be enacted today given that environmental issues are constantly being considered independent of NEPA through other federal environmental laws.
Short of full repeal, reforms to NEPA should include narrowing the review to only major environmental issues, mandating time limits and requiring a lead agency on projects, eliminating greenhouse gas emissions analysis from the review process, and allowing agencies to consider environmental impact analyses conducted under other federal statutes as the functional equivalent of a NEPA analysis.
Compensate property owners for regulatory “takings.” When the government seizes private property for a public use, it must provide just compensation to property owners. However, there is little to no protection for property owners when the government imposes regulations that restrict the use and enjoyment of property, even if most of the property’s value has been lost. These restrictions on property use, while not a physical seizure of property, are still a “taking” of a specific use of the property. Compensation mechanisms should be created within individual federal environmental statutes or in broad-based legislation that offset the costs borne by property owners as a result of federal environmental regulation. This change would not only start to provide better protection of private property rights, but it would also require agencies to be transparent about the true costs of their regulations and to take those costs into account when establishing agency priorities.
Fact: The U.S. has made dramatic improvements in air quality, but the EPA has continued to use an ever-expanding authority to implement stringent regulations with increasingly high compliance costs and diminishing marginal environmental returns. The aggregate emissions of six common pollutants decreased 68 percent from 1980 to 2018, while during that same time there was a:
Fact: In 1973, the Endangered Species Act (ESA) was enacted into law to promote the conservation of species. Unfortunately, the law has failed to achieve this goal.
Fact: Reducing the massive federal estate through privatization and shifting ownership to states and counties would yield better economic and environmental results.
The dominant narrative regarding the cause of the 2008 financial crisis is that deregulation in the 1990s was responsible, but that story is dead wrong. In fact, even if Congress were to repeal the entire Dodd–Frank Act, which it should, a highly flawed regulatory structure would still remain. There has never been a substantial reduction in the scale or scope of financial regulations in the U.S., especially not in the 1990s, and the pre-Dodd–Frank system contributed mightily to the 2008 crash. For nearly all of U.S. history, financial regulations—not simply banking regulations—have increasingly focused on risk management conducted by regulatory agencies rather than on disclosure and fraud prevention. Simultaneously, monetary policy has been increasingly relied upon to fix an expansive list of economics problems, well beyond the scope of the original stated purpose of creating a central bank (to provide an elastic currency), and well beyond what can reasonably be expected of monetary policy.
Preventing problems at financial firms from turning into system-wide banking crises has been a main justification for this approach, but it has failed miserably. The U.S. has had 15 banking crises since 1837, one of the highest totals among developed countries. Of the severe economic contractions that occurred in six developed nations between 1870 and 1933, banking crises occurred only in the U.S., and the U.S. is one of only three developed countries to have had two or more banking crises between 1970 and 2010. Furthermore, the evidence shows that the Federal Reserve has not been as effective as was once thought in accomplishing its stabilization goals. The long-term purchasing power of the dollar has dramatically declined under the Federal Reserve’s watch, and the benign deflation that arises from improved productivity has all but disappeared in the U.S.
In addition to these shortcomings, the U.S. regulatory and monetary framework, for at least a century, has protected incumbent firms from new competition—the very market force that drives innovation, reduces prices, and prevents excessive risk-taking. As a result, entrepreneurs have suffered from fewer opportunities, and consumers have suffered from fewer choices, higher prices, and less knowledge regarding financial risks. Thus, the U.S.’s approach to regulating and stabilizing financial markets has made it more difficult to create and maintain jobs and businesses that benefit Americans.
Repeal the Dodd–Frank Act. The Dodd–Frank Act became law during the Obama presidency when Nancy Pelosi (D–CA) led the House of Representatives and Harry Reid (D–NV) presided over a near filibuster-proof Senate majority. It was a partisan bill that garnered no Republican votes in the House and just three in the Senate. Dodd–Frank was largely a progressive wish list of policies that failed to address, much less fix, what caused the 2008 financial crisis. The more than 800-page boondoggle expanded the failed regulatory approach that helped create the 2008 crisis in the first place, and increased the federal government’s involvement in planning for, protecting, and propping up the financial system, thus enshrining “too-big-to-fail” policy into law. Repealing Dodd–Frank would be a good first step—but only a first step—toward protecting taxpayers and allowing private firms to easily provide the financial services that consumers need. In June 2017, the House passed the Financial CHOICE Act, a comprehensive financial regulatory reform bill that would have replaced the core of Dodd–Frank. Key provisions in the Financial CHOICE Act would have helped to restore market discipline and reduce regulatory burdens, thus moving the nation’s financial markets in the right direction. The Senate, however, passed the Economic Growth, Regulatory Relief, and Consumer Protection Act (S. 2155), a tremendously watered-down (compared to the CHOICE Act) bill that failed to repeal a single title of Dodd–Frank. (The bill did not even include those reforms that passed the House with strong bipartisan support.)
Rather than negotiate a compromise between the two approaches, the Senate forced the House to accept the Senate’s bill, and the President signed S. 2155 into law. The bill left all of Dodd–Frank in place, but provided special exemptions to various Dodd–Frank requirements for (mainly) smaller banks. While those banks were surely happy to have any regulatory relief, even the new exemptions came with the type of regulations that the CHOICE Act would have eliminated.
Provide an off-ramp style federal financial charter. Although banks are more heavily regulated than other financial firms, virtually all financial companies are subject to extensive restrictions on their activities, capital, and asset composition. Simultaneously, U.S. taxpayers have been forced to absorb more of these institutions’ financial losses in the name of ensuring stability. The result has been a massive substitution of government regulation for market competition, which culminated in the 2008 financial crisis. Fixing this framework requires rolling back both government regulation and taxpayer backing of financial losses, making it possible for private citizens to build a stronger financial system that efficiently directs capital to its most valued uses. Creating a new federal charter for financial institutions that relieves the regulatory burden for those who absorb more of their own financial risks and forgo government assistance would help achieve these goals.
Eliminate federal credit subsidies, guarantees, and insurance. Americans collectively shoulder approximately $20 trillion in debt exposure from loans, loan guarantees, and subsidized insurance provided by roughly 150 federal programs. This scheme erodes the nation’s entrepreneurial spirit, increases financial risk, and fosters cronyism and corruption. The programs and subsidies have given rise to powerful constituencies of beneficiaries because any losses are dispersed among millions of taxpayers. The government’s credit portfolio consists of direct loans and loan guarantees for housing, agriculture, energy, education, transportation, infrastructure, exporting, small businesses, and other purposes; federal insurance programs cover bank and credit union deposits, pensions, flood damage, declines in crop prices, and acts of terrorism. Capital for mortgage lending by banks (and non-banks) is provided by government-sponsored enterprises (GSEs) such as Fannie Mae and Freddie Mac, while federally-backed deposit insurance creates distortions and risks. Congress should immediately reduce federal deposit insurance coverage and ensure that coverage is provided on a per individual basis. Congress should also phase out government-backed deposit insurance along with all other credit subsidies, guarantees, and insurance.
Eliminate Fannie Mae and Freddie Mac, and shrink the role of the Federal Housing Administration (FHA). Fannie Mae and Freddie Mac, the government-sponsored mortgage giants, should be shut down for good. Both enterprises remain wards of the federal government, and they distort the market by issuing mortgage-backed securities with subsidized government guarantees. If such guarantees are necessary, the private sector can issue them and price them appropriately. Congress should take steps to liquidate Fannie and Freddie’s mortgage portfolios, as well as the companies themselves, and to ensure that they are not simply replaced by a new government-sponsored agency. Federal policies implemented through these government-sponsored enterprises have made housing more expensive and increased Americans’ risky debt. To begin winding them down, the GSEs should be prohibited from purchasing mortgages for homes that are not owner-occupied homes or for “cash out” refinances. Congress should also ensure that the GSEs only purchase smaller loans and charge higher fees, and that bank capital requirements no longer favor the GSEs’ mortgage-backed securities. For decades, the Federal Housing Administration (FHA) has competed with the GSEs for the riskiest mortgage loans, and the scope of the FHA’s mortgage insurance program must be addressed at the same time the GSEs are eliminated. Otherwise, all the risky loans financed by the GSEs will simply be insured by the FHA. The solution is simple: Restrict the FHA to insuring only a fraction of each mortgage (instead of 100 percent coverage), and do so for creditworthy low-income, first-time home buyers only.
Reform and consolidate financial regulators. Financial regulators’ budgets should be entirely composed of money appropriated by Congress. A commission governing structure for all financial regulators should be considered. Congress should also consolidate related powers in one regulator; remove authorities from agencies ill-equipped to use them; and revamp processes to ensure appropriate accountability for, and public input in, rule-making. Ideally, Congress would merge existing agencies and create only one federal banking regulator and one capital markets regulator. In the process, Congress should remove the Federal Reserve entirely from regulation and supervision. Congress should also eliminate the (Dodd–Frank created) Consumer Financial Protection Bureau (CFPB). Most of the Bureau’s authority could easily be handled by the Federal Trade Commission (FTC), an agency whose mission is to protect consumers. These policy reforms would produce more effective financial regulation by making financial market participants, including regulators, more directly accountable for their actions.
Restrain the Federal Reserve with rules-based monetary policy and emergency lending restrictions. Congress can greatly improve monetary policy by replacing the Federal Reserve’s current legislative mandate to promote stable prices and maximum employment. In its place, Congress should give the Federal Reserve a mandate with the single goal of achieving monetary neutrality (supplying only the amount of money the economy needs to keep moving, no more and no less) by stabilizing overall spending in the economy. Maintaining a reasonable growth path for total spending—often referred to as nominal gross domestic product (NGDP) targeting—is the best way for the Federal Reserve to maintain monetary neutrality. Among other benefits, this new framework would allow the price level (overall prices) to decline as productivity improves, thus making it easier for people to enjoy the benefits of more goods for sale at lower prices. Congress should also limit the Federal Reserve so that it can only provide system-wide liquidity on an ongoing basis, rather than allocating credit to specific firms on an ad hoc basis. Emergency lending authority is unnecessary for conducting monetary policy, and Congress should replace the Federal Reserve’s existing primary dealer system with a single standing facility to meet extraordinary as well as ordinary liquidity needs. This change would make Fed lending to insolvent institutions—even during a crisis—unnecessary.
Reduce regulatory impediments to capital formation. Congress should remove regulatory impediments that limit entrepreneurs’ access to the capital necessary to launch and grow new businesses. Congress should preserve the existing thresholds for private offerings and expand the ability of sophisticated investors to invest in private offerings (usually Regulation D offerings). Current law allows large public companies to raise capital without having to deal with 50 different expensive and time-consuming state registration and qualification requirements (known as blue sky laws). Congress should allow smaller public companies and other smaller companies with extensive federal disclosure requirements to also be free of this burden. Congress should replace the 14-plus categories of securities-issuing firms (as described by the existing rules) with three disclosure regimes: public, quasi-public, and private. Just as important, Congress should replace the current complex and arbitrary federal disclosure system with a reasonable, coherent, and scaled disclosure system that imposes increasing requirements as companies grow and have more shareholders with more capital at risk. Congress, or the Securities and Exchange Commission (SEC), should clarify that entrepreneurs may use finders and private placement brokers to assist them in raising capital. Finally, it is time to create a micro-offering exemption allowing very small private companies to raise capital without having to comply with complex SEC rules.
Design an efficient securities-fraud deterrence regime. For capital markets to function well, investors need accurate information about securities. If investors do not trust firms’ disclosures, they will discount what they are willing to pay for securities. This increases the cost of capital and makes it more difficult, even for honest firms, to cost-effectively raise capital. Deterring fraud in the capital markets should be a government priority, but the current U.S. approach to securities-fraud deterrence falls far short of the ideal. Congress and the SEC should implement a system that: (1) places more emphasis on culpable individual and manager liability, (2) reduces the reliance on corporate criminal penalties borne by shareholders, and (3) limits private enforcement to traditional common law remedies or other compensatory remedies possessing similar safeguards against over-deterrence.
Reform the SEC. The U.S. Securities and Exchange Commission is the most important regulator of U.S. capital markets. Although its budget has increased by 82 percent over 10 years, its effectiveness remains in doubt. Resources have flowed into unnecessary management, “support,” and ancillary functions, while core functions have been neglected. Its organizational structure is unwieldy. The Commission needs to be better managed—it does not need (as has been proposed) more managers. The number of direct reports to the Chairman needs to be reduced. Its information technology programs appear to be poorly managed and are unnecessarily costly. The SEC bases its decisions on inadequate data. It does much less than most agencies to provide data to Commissioners, other policymakers, and the public. Its enforcement efforts directed at fraud and other malfeasance by managers of large financial institutions are inadequate. The Commission does little to remove unnecessary regulatory impediments to entrepreneurial capital formation. Reforms are necessary so that the SEC can better support well-functioning capital markets.
Reform FINRA. FINRA is the primary regulator of broker-dealers and their employees. It is neither a true self-regulatory organization nor a government agency. It is largely unaccountable to the industry and to the public. Due process, transparency, and regulatory-review protections normally associated with regulators are not present, and its arbitration process is flawed. Reforms are necessary. FINRA itself, the SEC, and Congress should reform FINRA to improve its rule-making and arbitration process.
Do not impose beneficial ownership reporting requirements. Congress is seriously considering imposing a beneficial ownership reporting regime on American businesses and other entities, including charities and churches. The most recent legislation, the Corporate Transparency Act (CTA) and the ILLICIT Cash Act, would create a large compliance burden on businesses with 20 or fewer employees (the only non-exempt category) and would create as many as one million inadvertent felons. Under the CTA, religious organizations, charities, and other exempt entities and their employees would be subject to fines and imprisonment unless they file the proper certification of exemption with the Financial Crimes Enforcement Network. The rules are easily and lawfully avoided by the sophisticated—and would do virtually nothing to achieve their stated aim of protecting society from terrorism or other forms of illicit finance. Furthermore, the vast majority of the information that the proposed reporting regime would obtain is already provided to the Internal Revenue Service (IRS). Allowing the IRS to share this information with the Treasury Department’s Financial Crimes Enforcement Network would better meet the needs of law enforcement by providing more comprehensive information and better enforcement than would the proposed reporting regime.
Fact: Deregulation did not cause the 2008 financial crisis.
Fact: Extensive regulation is supposed to prevent problems at financial firms from turning into system-wide banking crises, but the approach has failed.
Fact: Dodd–Frank doubled down on the failed approach of the past.
Fact: The regulatory relief bill signed into law in 2017 merely provides special exemptions to certain Dodd–Frank regulations.
Fact: Poorly designed government policies led to the 2008 financial crisis.
Fact: The Federal Reserve’s track record deserves a closer look.
Transportation infrastructure is necessary for both a functioning economy and the public’s quality of life. The ability of Americans to move their families and products from town to town, city to city, coast to coast, and border to border is dependent upon functional roads, rails, bridges, airports, and waterways.
The vast majority of transportation infrastructure assets are owned, operated, and maintained by state and local governments, businesses, and individuals. Despite this, there has long been a tendency to look to Washington for financial resources to start new projects. Excessive federal involvement has led to inefficiencies, delays, and waste, rather than superior infrastructure for the nation. What should be a limited federal role in overseeing nationally significant infrastructure has morphed into a vast system of intergovernmental transfers designed primarily for political benefit instead of the public good.
Rather than focusing on the highways and byways that the vast majority of citizens use on a daily basis, would-be central planners force motorists to subsidize other modes of transportation. As a result, Congress diverts Highway Trust Fund spending derived from gas taxes toward programs unrelated to highways. This goes against the long-standing “users pay, users benefit” principle of infrastructure spending. Motorists and truckers are thus subsidizing urban transit, bike paths, and ferryboats.
Political leaders regularly promise that ever-increasing federal infrastructure spending will generate jobs, economic growth, and luxurious public transportation. However, such projects—often focused on transit—are unrealistic, economically unsustainable, and incompatible with the day-to-day lives of most Americans. Federal efforts to promote long-distance high-speed rail and urban mass transit have consumed hundreds of billions of dollars in recent decades, with consistently disappointing results in terms of ridership and cost-effectiveness.
The core debate should not be whether America seeks to improve the value of its infrastructure or not. Instead, the consideration should be how to do so efficiently and who will be in charge of making infrastructure decisions. In the overwhelming majority of instances, this should be done at the local and state level or by the private sector. Since local and state governments, and private businesses, are more accountable to the public than Washington, and since they know their transportation needs better as well, they are in a better position to address those needs and, indeed, already generate most of their own transportation funding. The federal government discourages such initiative through mandates and burdensome regulations, and crowds out effective private and local investments with federal dollars.
Given that infrastructure projects are rarely national in scope, Congress and the Administration should seek to empower states and the private sector by reducing the role of the federal government in transportation.
Limit the highway program to highways. As long as the federal government has a role in transportation policy, it should focus on programs that are truly national in nature, and work toward goals such as enhancing mobility, reducing congestion, and improving safety, all in a cost-effective manner. Currently, more than 25 percent of Highway Trust Fund (HTF) spending is for programs that have little to do with the federal highway program or national priorities. Although HTF spending on highways roughly matches revenues from the gas tax, additional non-highway spending has made the fund unsustainable without regular bailouts. Refocusing HTF spending would put the trust fund on a path toward solvency. Diversions that Congress should eliminate include:
The needs and preferences of voters vary widely from state to state, and today’s one-size-fits-all, federally focused approach to both taxing and spending creates imbalances and inefficiencies. Devolving most federal responsibility for highway-related taxing, spending, and regulating to states would enhance the value of infrastructure spending by allowing local leaders more flexibility to implement solutions that best fit their areas.
Reduce the federal role in transit funding. Unnecessarily high operating costs plague transit systems across the country, facilitated in part by federal subsidies that remove incentives for transit agencies to cut costs and operate efficiently. Federal subsidies distort inherently local transit decisions made by state and local governments, as the subsidized programs are given priority over more imminent local needs that Congress does not favor. Without these costly federal subsidies, local and state governments would better gauge the funding and operating feasibility of transit systems.
Congress should phase out federal transit programs and their funding over a five-year period, thus refocusing the Highway Trust Fund on its core mission and restoring the integrity of the “user pays, user benefits” model. Likewise, lawmakers should eliminate discretionary competitive grants such as the “New Starts” program, which provides perverse incentives for localities to build new, unnecessary transit systems while ignoring the maintenance of existing infrastructure.
Finally, the federal government should devolve control for most of the National Highway System to the states and lower the federal gas tax. State governments would have more autonomy to make spending and revenue decisions that fit their transit needs.
Unburden infrastructure from mandates and regulations. While some amount of oversight is appropriate to ensure proper stewardship of federal taxpayer dollars, far too much infrastructure regulation is politically driven micromanagement. The Davis–Bacon Act,1 which mandates the use of union pay rates, increases project costs by roughly 10 percent. Project Labor Agreements dictate union-style work rules. Protectionist “Buy American” provisions further inflate costs by banning the purchase of imported physical inputs. Similarly, the Foreign Dredge Act2 and the Jones Act3 are archaic, protectionist barriers affecting seaports and shippers.
All of these rules serve to reduce the efficiency and flexibility of the private sector contractors who perform infrastructure work. Congress should eliminate these constricting rules.
Streamline the environmental review process. Currently, all major infrastructure construction projects are subject to federal permitting and environmental review processes. The federal government administers 59 different permits through 12 different agencies. Environmental reviews alone take an average of five years and can cost millions of dollars. Many major projects take a decade or longer to obtain a complete set of permits.
Allowing states to certify that projects meet federal requirements would accelerate the permitting process by removing it from the slow, centralized Washington bureaucracies. Repealing the outdated National Environmental Policy Act4 would greatly reduce red tape without damaging the environment.
Liberate airports by grounding regulations and cancelling the airport improvement program. In contrast to most developed nations, major U.S. airports are owned and operated by local governments rather than by the private sector. A leading cause of this is the long-outdated federal approach of heavy regulation and counterproductive subsidies.
The Airport Improvement Program (AIP) levies taxes on airfare and aviation services. The AIP then distributes those funds to airports for use in capital projects such as runways. Funding is based on a formula that heavily favors small and non-commercial airports. Large, successful airports pay full AIP taxes for every passenger served, but receive much smaller amounts of AIP funding per passenger above the 50,000 threshold. Thus, AIP penalizes large airports for the benefit of smaller ones, creating perverse incentives regarding passenger service and terminal quality.
The Passenger Facility Charge system, another federal rule that hampers the improvement of airport terminals, denies airports the ability to charge customers based on the needs of the airport. Instead, the Federal Aviation Administration determines how much airports can charge. With the amount capped at $4.50 per passenger in 2000, with no adjustment for inflation, airports often struggle to finance expansions and improvements. This benefits major airlines at the expense of small and startup companies, since big carriers control most existing gates and would face more competition if airports had capital on hand for expansion.
Passengers would benefit immensely if Congress were to eliminate the AIP, reduce or eliminate airfare taxes, and further pro-market regulatory reform. These actions would encourage private investment in the industry, heighten competition for passengers (and in turn lower ticket prices), and enhance the quality of airports.
Privatize many federal transportation services. The federal infrastructure portfolio includes worthwhile assets and services. However, in many cases a shift from federal provision and operation to overseeing private-sector actors would serve the public good by bringing market incentives and better management. Congress should privatize the following federally owned and operated endeavors:
Amtrak. As the American public shifted away from passenger rail over the course of the 20th century, many regional railroads went out of business. The federal government started Amtrak in 1971 to continue passenger rail service across the country. In the nearly five decades since, billions of dollars in taxpayer subsidies have not brought the public back for most Amtrak lines. While the Northeast Corridor is currently financially viable, the system as a whole requires comprehensive reform.
Privatizing Amtrak and ending federal subsidies would allow profit-based incentives to improve service on popular routes, while finally admitting that some little-used regional lines are no longer a national priority. States would have the option to continue these lines themselves. Alternately, Congress could use public-private partnerships as an intermediary step, allowing private service improvements while maintaining public ownership.
Air Traffic Control. The Federal Aviation Administration’s (FAA) Air Traffic Organization (ATO) provides air traffic control services for the flight industry. Worldwide, it is one of the only air navigation providers still operated by an aviation safety regulatory agency. The ATO’s bureaucracy has allowed it to become woefully outdated and inefficient, especially when compared to privatized counterparts in nations such as Canada and the United Kingdom. Rather than having the FAA attempt to make the ATO effective by continuing to pour money into it, Congress should fully privatize ATO, which can be done by turning it into a nonprofit entity. This would liberate ATO from the many problems endemic to government bureaucracy.
St. Lawrence Seaway Development Corporation. Congress and the Administration should privatize the St. Lawrence Seaway Development Corporation (SLSDC), which maintains and operates the U.S. portion of the Saint Lawrence Seaway. Canada privatized its portion of the seaway in 1998, which eliminated the need for taxpayer funds.
Inland Waterways. A network of 12,000 miles of inland waterways spans the country. This infrastructure has been poorly maintained by the Army Corps of Engineers, reducing capacity for ships and causing needless delays. A fuel tax has proven insufficient to fund capital improvements. Meanwhile, all federal taxpayers pay for operations, resulting in massive subsidization of the system.
Reforming waterways through the implementation of user fees would improve service for users and be fairer for taxpayers. Both the Trump and Obama Administrations have embraced this course of action. Additionally, much of the waterway system could be fully or partially privatized, allowing for greater efficiency of operation and providing incentive for investment that does not rely on taxpayer dollars.
Fact: The condition of the nation’s major infrastructure is steadily improving.
Fact: Misuse of surface transportation funds has needlessly increased the national debt.
Fact: Outdated policies hold back U.S. airports.
Fact: Federal transit programs waste taxpayer dollars to obtain political buy-in.
Taxes directly affect the well-being of every American. While taxes are a necessary evil to fund a limited constitutional government, a well-designed revenue system minimizes the damage caused to individuals and to businesses’ ability to innovate and create new jobs. Taxes that are too high or poorly designed can destroy wealth, discourage investment, and stifle economic opportunity. Following the most sweeping update to the U.S. tax code in more than 30 years, Americans are no longer suffering under its most burdensome features.
The Tax Cuts and Jobs Act of 2017 (TCJA) simplified tax paying for many Americans, lowered taxes on individuals and businesses, and updated the business tax code so that American corporations and the people they employ can be globally competitive.
Many Americans are benefiting twice from the tax cuts: first, by paying less in taxes, and second from higher wages generated by a faster-growing economy. In the first quarter of 2019, the economy exceeded expectations and wages continued to grow, with low-income workers receiving the largest gains.1
In 2025 most of the individual and some of the business tax cuts will expire. The deadline gives Congress an opportunity to revisit the tax code, to make much of it permanent and address many remaining issues not included in the 2017 tax bill.
Federal taxes in America are paid in three main ways. First, the individual income tax raises 50.6 percent of federal revenue, including taxes paid on investments (capital gains and dividends) and taxes on business profits paid directly by the owners on their individual tax return. Second, payroll taxes make up 35.2 percent of federal revenues, and third, the corporate income tax makes up just over 6 percent. People—investors, workers, and consumers—ultimately pay business taxes, such as the corporate income tax. Workers shoulder the largest burden through lower wages.2
At its core, the U.S. tax code remains too complex and includes a fundamental bias against saving and investment. Myriad subsidies and carve-outs for the politically connected endure, adding to complexity and economic distortions. The biggest distortion is caused by the double-tax on savers, which levies a tax on wages and a second tax on any earnings if the wages are saved and invested. The return on savings and investment is simply compensation for waiting to use the income, so by taxing the investment earnings, the tax code makes saving more expensive relative to spending immediately. The lower tax rate on capital gains and dividends (with a top rate of 20 percent on long-term capital gains versus a 37 percent top marginal rate on income) helps move the income tax toward a more neutral treatment of saving.
Ultimately, the tax system should use the least economically destructive forms of taxation to raise the revenue necessary to fund a limited government that carries out its constitutionally delegated powers. Toward this aim, Congress can build on the success of the 2017 tax cuts by making them permanent, continuing to lower taxes on saving, and eliminating tax subsidies.
Make the Tax Cuts and Jobs Act permanent, and expand expensing. The 2017 tax cuts reduced federal income tax rates, increased the standard deduction, doubled the child tax credit, repealed the personal and dependent exemptions, and capped the SALT deduction, among many other reforms.3 Most of the law’s individual tax provisions expire in 2025, and Americans’ taxes are scheduled to increase in 2026.
Although the majority of media attention surrounding the TCJA has centered on lower tax rates for individuals and businesses, the TCJA’s adjustments to investment rules has equally important benefits for American workers, supporting higher wages and more jobs. The U.S. tax code generally imposes years of delay between the moment at which businesses pay for an investment and the point at which they can deduct the full cost of that investment on their taxes. This raises the cost of the investment, which slows gains to future worker productivity and thus shrinks incomes.
The tax cuts temporarily fixed this problem for some short-lived investments through “expensing,” allowing businesses to write off some new investments immediately. Buildings, such as new manufacturing floor space and storefronts, still have to use the costly and complicated pre-TCJA system, characterized by arbitrary depreciation schedules, concocted by federal bureaucrats often with little to no business experience. The budgetary cost of expanding expensing to all investments would be high in the first few years of the reform on account of transition costs, but the economic benefits of the new system would be well worth the short-term budget impact.
In addition to protecting Americans’ paychecks from higher taxes, a permanent version of the 2017 tax cuts could increase the size of the economy and further boost Americans’ paychecks. Permanent tax cuts and expanded expensing could boost the size of the economy by 4.3 percent over the pre–tax cuts baseline, according to an estimate from when the law was passed.4 That would more than double the economic benefits that are expected to result from the temporary provisions under current law.
Enact Universal Savings Accounts. The current tax code tells Americans to only save for retirement by not offering the same tax protections to other forms of saving that are available through 401(k)s and individual retirement arrangement (IRAs). Universal Savings Accounts (USAs) would reduce taxes on savings for all Americans and help families build their own financial security through a single, simple, and flexible account.
Unlike existing retirement savings accounts, USA holders would not be bound by limits on when savings can be withdrawn or for what purpose people may use their personal savings. Individuals would contribute post-tax earnings, and all withdrawals from a USA would be excluded from taxable income; any gains accrued would thus be tax-free. USAs would allow Americans at all income levels to save more of their earnings with fewer restrictions on where and when they can spend their own money.5
Cut tax subsidies. Each year, the tax code is used to hand out billions of dollars in subsidies to politically connected interests, picking winners and losers and distorting market outcomes. Tax code spending persists without systematic review or annual appropriation by lawmakers in Congress.
The tax code should not be used to pick winners and losers. That means the next round of tax reform should eliminate all individual and corporate deductions, credits, exclusions, and exemptions that are not economically justified. Some of the most egregious tax subsidies are the myriad tax breaks for the production and consumption of politically favored types of energy and energy-efficient products that distort energy markets, making them less efficient and dependent on government subsidies. Other examples include: tax credits for college expenses that contribute to the inflated cost of college for every American student, the research and development tax credit that is an inefficient subsidy for an activity most companies would do anyway, and the low-income housing tax credit that creates incentives for local government corruption and primarily subsidizes developers, not renters.6
The 2017 tax reform introduced new tax preferences which should be rolled back, like the temporary tax credit for paid family leave and the new 20 percent deduction for pass-through businesses. The bill also did not fully eliminate existing subsidies like the newly capped state and local tax (SALT) deduction, which should be zeroed out, as it is harmful for individuals and businesses. Each of these tax preferences and many others add unnecessary complexity to the tax code and reduce economic growth because individuals and businesses become reliant on government subsidies rather than on market signals when making decisions about where to live or what to produce.
Further simplify and lower taxes on wages and saving. Reforms should streamline retirement accounts so that more workers have access to a single, simple system that is not necessarily tied to individual employers. Most Americans are familiar with personal retirement savings accounts, such as 401(k)s and IRAs, but few take full advantage of their benefits. The main impediment to more widespread use of the accounts is their complexity, compliance cost, and the regulatory risk for smaller employers. Depending on employment status, American savers have access to dramatically different levels of retirement saving options across 16 different retirement accounts. The patchwork of rules discourages uptake and subdivides individual’s savings into multiple accounts, often stuck with past employers.
There is a long list of small but significant reforms to improve the efficiency of the tax system that any policymaker should be aware of. A few of the most important items:
If Congress can control spending, taxes should be cut further on personal income, capital gains, and business income. These pro-growth reforms would benefit American workers through higher wages and greater economic opportunity.
Reject new sources of revenue. If Congress is unwilling to address the growth rate of federal spending, the pressures of yearly deficits and mounting debt will eventually yield to the siren song of new taxes. There is already frequent talk of a federal value-added tax (VAT), a carbon tax, a border adjustment tax (BAT), wealth taxes, and financial transactions taxes, each designed to raise new and higher levels of revenue.
A new tax would increase complexity and allow the federal government to extract more money from American taxpayers. A VAT, for example, would raise taxes on the middle-class to the tune of trillions of dollars. The new revenue would enable an unprecedented expansion of the federal government, while making Americans poorer and more dependent on the government. In addition to expanding government in size and scope, carbon taxes would inflate energy costs, kill jobs, and shrink incomes. Spending reforms, not tax increases, are the only way to balance the budget while expanding free enterprise, limited government, and individual freedom.
Fact: Nine out of 10 taxpayers received a tax cut or no change in 2018.
Fact: High-income taxpayers already pay the lion’s share of federal income taxes, and the 2017 tax cuts made the tax code more progressive.
Fact: The deficit and debt are not the result of the 2017 tax cuts.
Advances in technology have jolted economic, political, and social sectors around the world by upending business models, altering human interactions, and democratizing telecommunications. The benefits are incalculable, of course. But the disruption has also sown uncertainty and anxiety about online propaganda, content mismanagement, privacy and security lapses, and fake news. Thus, the United States now stands at a crossroads as calls for regulation mount.
The political narrative on Capitol Hill is largely based on the proposition that the public is defenseless against the tech titans and in need of government protection. That is a difficult assertion to prove or disprove given the billions of Internet users. It is likely that many people do understand the basic business model that enables free online services. There undoubtedly are a significant number of people who do not know that their online activity is tracked across accounts and devices or that the data are sold.
Whatever the level of consumer understanding, the salient issue is whether regulation is necessary, appropriate, or capable of addressing the issue effectively. In the current context, it is none of these, given the wealth of nongovernmental remedies available and the continuous development of new ones.
Perhaps more than any other economic sector, technology’s entrepreneurial spirit risks being crushed by regulation. Innovation is inhibited when government imposes standardized “solutions” rather than allowing technology to evolve through competition and consumer preference.
Regulators cannot possibly keep pace with the technology churn. Indeed, recent hearings in Congress revealed that few lawmakers have a firm grasp of Internet basics. That leaves lawmakers to substitute political considerations for market realities, masking the signals that would otherwise guide investment and innovation most efficiently. The likelihood of policy and regulatory blunders is very high, and the consequences grave, including solidifying the dominance of incumbents for years to come.
Government intervention in telecommunications has been a major factor in America trailing Asian and European nations in deploying the most advanced wireless and broadband technologies. Political and regulatory processes always trail the pace of technological change.
The magnitude of European regulatory burdens, along with the prospect of more in the pipeline, is prompting Google, Apple, Twitter, and others to pursue regulation in the U.S. in hopes of averting a patchwork of foreign, federal, state, and even local dictates. But it is important to recognize that the industry is embracing regulation for the sake of expedience rather than consumer benefit. Meanwhile, the costs of regulation fall disproportionately on small businesses and inhibit new entrants, which forestalls competition and secures the dominant incumbents. Cronyism—regulatory or otherwise—violates the fundamental principles of a free market.
Some conservatives are pursuing regulation as retribution for alleged online censorship. But aggrieved parties should instead put their conservative principles into action—that is, marshal resources in support of more neutral options or finance their own online services. Anecdotes abound about biased algorithms, but private enterprises are not obligated to abide by any sort of partisan fairness doctrine, were such a thing enforceable in any systematic way, which it would not be.
The greater the demand for privacy and data protection, the more incentive there is for research and development. Exploiting such demand is one of the principal means by which startups gain a foothold against dominant incumbents.
In the broadest terms, the role of government in technology policy is to protect and defend citizens’ voluntary transactions (e.g., contract, investment, acquisition, ownership) and settle disputes in matters of law.
The nation’s technological progress largely depends on upholding the fundamental principles of free enterprise, limited government, and property rights—and not on allegiance to regulatory schemes that will yield more harm than benefit.
Facebook, Google, and others do wield enormous influence, but big is not by definition bad, nor are consumers necessarily ill served by a small number of competitors in a given market. Anti-trust enforcement should be limited to actual instances of unlawful action intended to subvert competition (e.g., bid rigging and price fixing) rather than as a means to create a hypothetical ideal market.
Consumers are best equipped to punish commercial wrongdoing, and technology has vastly expanded their capacity to do so. Opinions can be broadcast around the world in seconds. Meanwhile, today’s dominant platform is just one upstart away from irrelevance: Remember Myspace?
Regulation shifts labor and capital away from productive activity and into compliance activity. The pace of technological change makes it virtually impossible for regulation to remain relevant. And, regulation imposes a disproportionate burden on new businesses, which undermines competition and secures the dominance of incumbent firms. Meanwhile, the costs of compliance drive mergers, further consolidating markets.
Political “solutions” are inherently unreliable because neither Congress nor the executive branch is bound by the actions of its predecessors, except in the granting or sale of private rights. Government remedies are also weak by virtue of the concessions necessary to gain approval.
Facebook, Twitter, and Google are private enterprises, not agents of government to whom Congress can dictate security functions. Responsibility for protecting the nation from foreign threats belongs first with national security and intelligence agencies, and those elected to oversee them.
Fact: Americans’ time online increased 139 percent between 2000 and 2018.1
Fact: The economic and social changes unleashed by the Internet—in particular, social media and “edge” providers—have occurred in remarkably rapid fashion.
Fact: Dominance today does not ensure dominance tomorrow.
Fact: Given the amount of new investment of late, there is reason to believe that tech applications will become even more imbedded in daily life in the future.
Fact: American companies have sunk a whopping $7.8 billion into compliance with the European Union’s new Internet regulations, while British firms have laid out $1.1 billion.4
As long as elections put people into positions where they can make decisions about how much the government will spend, who will receive benefits, and how the government will exercise its power, some people will attempt to cheat. Examples abound throughout our history, from the 135 percent of eligible voters who turned out for an 1844 election in New York to the infamous Ballot Box 13 in Lyndon Johnson’s 1948 Senate election. The 1997 Miami mayor’s race was overturned because of more than 5,000 fraudulent absentee ballots. A mayoral election in East Chicago, Indiana, in 2003 and a state senate race in Tennessee in 2005 were also overturned because of voter fraud.
In 2013, four people in Indiana were convicted of forging signatures on the ballot petitions that qualified Barack Obama for the state’s May 2008 primary election. In 2015, a city council race in the New Jersey town of Perth Amboy was decided by a mere 10 votes. A judge overturned the election and ordered a new one after it was revealed that at least 13 illegal absentee ballots had been cast. More recently, the mayor of Gordon, Alabama, was removed from office after being convicted of voter fraud in an election that was won by only 16 votes.
As the Supreme Court of the United States recognized when it upheld the constitutionality of Indiana’s voter identification law in 2008, flagrant examples of voter fraud “have been documented throughout this Nation’s history by respected historians and journalists.” Those examples “demonstrate that not only is the risk of voter fraud real but that it could affect the outcome of a close election.” The Heritage Foundation’s Election Fraud Database has documented nearly 1,300 instances of voter fraud from across the country, and the number continues to grow.
Many partisan activists, liberal academics, and members of the media elite deny that election fraud exists or that any action is needed to protect the integrity of our election process. The nonpartisan Commission on Federal Election Reform, however, chaired by former President Jimmy Carter and former Secretary of State James A. Baker III, found that the “electoral system cannot inspire public confidence if no safeguards exist to deter or detect fraud or to confirm the identity of voters.”
The right to vote in a free and fair election is a citizen’s most basic civil right, the one on which many of the other rights of the American people depend. Congress and the states can and should guarantee that every eligible individual is able to vote—and that no one’s vote is stolen.
Require all voters in federal elections to present photographic identification, issued by the federal, state, local, or tribal government, when they vote at their polling place and to send copies of such identification when submitting an absentee ballot. Such ID should be provided free of charge to those who request it for voting purposes.
Allow state election officials to verify U.S. citizenship of registered voters by making the Social Security Administration and Department of Homeland Security (DHS) databases available to the officials.
Require all federal courts to notify state election officials when individuals whose names are drawn from their voter registration rolls are excused from jury duty because they are not U.S. citizens and to notify the U.S. Department of Justice for investigation and possible prosecution.
Amend the National Voter Registration Act of 1993 to allow states to strike individuals who have not voted in two consecutive federal elections from the voter rolls. These individuals must previously have been informed in writing that they will be removed unless they contact election officials by a certain time.
Amend the National Voter Registration Act of 1993 to clarify that states may require proof of citizenship from individuals registering to vote.
Require DHS to inform the Department of Justice about all information it has on noncitizens who have registered for or voted in elections. Not only should aliens who have illegally registered or voted have their visas revoked and their citizenship applications rejected, but the Justice Department needs to investigate and prosecute noncitizens who have violated federal law.
Sunset the U.S. Election Assistance Commission, a federal agency created in 2002 to administer a one-time grant of federal funds to the states. Having this superfluous federal agency in place will tempt Congress to give it expanded authority to impose federal mandates through federal regulations, which could lead eventually to the complete takeover of the election process by the federal government.
Direct the Department of Defense to create voter registration offices on all military installations to provide voting assistance to military personnel and their families and allow nonpartisan veterans groups to hold voter registration drives at commissaries or other public locations on military posts and bases.
Require all voters to present photographic identification, issued by the federal, state, or local government, when they vote at their polling place and to send copies of such identification or their driver’s license number when submitting an absentee ballot. Any individual who does not have identification should be entitled to receive it free from state authorities. Both academic studies and election results show that identification requirements do not depress the turnout of voters, including minority voters. The vast majority of voters of all parties, races, and ethnic backgrounds support such a requirement, which increases public confidence in the integrity of elections.
Require all individuals who register to vote to provide documentation establishing that they are U.S. citizens. States have an interest in preventing dilution of the votes of their citizens at the state level and must maintain citizen-only voting rolls for federal elections. When a state issues a driver’s license to a noncitizen who is in the country legally or illegally, the license should indicate on its face that the holder is not a U.S. citizen.
Require state and local election officials to verify the accuracy of new voter registration information against other available state and federal databases. Section 303 of the Help America Vote Act (HAVA) of 2001 requires states to coordinate their voter registration lists with “other agency databases” and to “verify the accuracy of the information provided on applications for voter registration.” Some election officials are not complying with this law and not verifying new voter registration information against other available databases, such as Department of Motor Vehicles driver’s license records and Social Security Administration records. Legislators should implement this requirement as a state law to ensure that their state election officials will follow this commonsense requirement.
Require individuals who register by mail to vote in person the first time they vote. Section 6 of the National Voter Registration Act allows states to implement such a requirement, although it cannot apply to any voter entitled to vote by absentee ballot under the Uniformed and Overseas Citizens Absentee Voting Act or the Voting Accessibility of the Elderly and Handicapped Act.
Require all individuals who register to vote by mail-in forms, whether mailed back to election officials or hand-delivered by the individual or third-party organizations, to comply with the applicable HAVA provision. HAVA requires persons who register to vote by mail and who have not previously voted in a federal election to provide a copy of certain identification documents when they register or the first time they vote, but some states have interpreted this to apply only to voter registration forms received through the mail and not to such forms when they are delivered through other means.
Require all third-party organizations that conduct voter registration drives to write the name of their organization, as well as that of the volunteer or employee handling each registration, on the voter registration form and that all completed forms be returned to election officials within 10 days of the date on which the forms are signed by the person registering. This would allow election officials to identify which organization and individual handled voter registration forms that are found to be incomplete or fraudulent and to ensure that completed registration forms are provided to election officials on a timely basis so that they can be properly processed before the state’s pre-election registration deadline.
Require all state courts to notify election officials when individuals whose names are drawn from the registration rolls are excused from jury duty because they are not U.S. citizens or no longer live in the jurisdiction. This would allow local election officials to remove ineligible voters and refer them for possible prosecution. Running data comparisons between voter registration addresses and property tax rolls is also recommended to detect individuals who are registering illegally at commercial addresses or vacant lots.
Require that each state enter into agreements with other states, such as the Interstate Voter Registration Crosscheck Program, to compare voter registration lists to find people who are registered in more than one state. Because there is no national voter registration list, it is relatively easy for individuals to register in more than one state without detection. Such agreements are critical to detecting and deterring double registration and possible double voting.
Reject any effort get rid of the Electoral College. Any state compact to manipulate or alter the Electoral College requires congressional assent. Such a compact should not be approved, and any constitutional amendment to scrap the Electoral College should be rejected.
Fact: States have the right and responsibility to ensure the integrity of their elections and to ensure that the votes of eligible voters are not stolen or diluted by fraud.
Fact: Election fraud is a reality that has been documented repeatedly through the prosecution and conviction of criminal cases.
The expression “a nation of immigrants” reflects the unique benefits that immigration has provided to the U.S. throughout our history. But the current legal immigration system is not designed for the 21st century, and it is failing both to maximize the benefits of legal immigration and to minimize the costs.
Under the current system, the U.S. provides lawful permanent residence—a green card—to around one million foreigners each year. In fiscal year (FY) 2017, for example, the U.S. granted 1.127 million green cards. Green cards are allotted according to decades-old statutes. As a result, the largest category of green card distribution is to family members of U.S. citizens and lawful permanent residents. In 2017, the U.S. granted 748,746 green cards—or about two-thirds—on the basis of a recipient’s status as a family member or an immediate relative. Of this subtotal, over half a million were given to spouses, children, and parents—“immediate relatives” under U.S. law—who are able to receive an unlimited number of green cards each year. By contrast, only 137,855 green cards were awarded based on employment. The Diversity Visa Program lottery issued around 50,000 visas, while refugees, asylees, and other categories totaled approximately 180,000 green cards.
By comparison, Canada granted 56 percent of its green cards in 2017 for economic reasons and Australia gave 62 percent of its permanent visas for economic reasons. Other nations also define “immediate relatives” more narrowly to include only spouses and minor children. These policies make sense because these countries are using immigration to maximize national interests. By focusing on merit-based immigration, countries can ensure that immigrants contribute to the economy and will not consume government benefits at the expense of existing taxpayers. The U.S. system, however, for the most part, does not consider economic or fiscal considerations, and thus fails to maximize its national interests.
The COVID-19 pandemic makes the need for an economy-based immigration system more acute. The premise behind such a system is not simply to bring in more employment-based immigrants and fewer family-based immigrants. Rather, the idea is to have an overall immigration system that is attuned to America’s needs. With unemployment at historic highs due to pandemic lock-down orders, the employment priority is to get Americans back to work. Accordingly, the federal government needs to carefully craft and revise immigration policies that benefit Americans and our economy.
Beyond issues of money and economic growth, immigration is also about assimilating people with certain values and principles. Historically, governments and institutions at all levels have played an active role in the Americanization process. The Founders knew that the new country would attract even more immigrants, so they believed in assimilating and educating them, as well as the native-born, to inculcate the nation’s philosophy into a new population, giving American democracy its “demos.” Over the past few decades, however, America has drifted away from assimilating immigrants: Elites in government, culture, and academia have led a push toward multiculturalism, which emphasizes group differences. Instead of E pluribus unum—out of many, one—assimilation is seen as a humiliating demand that the purportedly marginalized conform to the identities of their supposed oppressors. This view must not be allowed to control U.S. policies.
Establish a merit-based immigration system. Congress should modify the family preference system and move to a new merit-based system of visas. A shift from family-based immigration to merit-based immigration would prioritize economically and fiscally beneficial immigration and better serve our national interest. Such a system should be designed in a way that recognizes that the market is the best and most objective way to identify those who will benefit the economy. This starts with requiring immigrants to have an offer of employment (an objective market signal) or financial means of self-support before entering the country. The government would not be picking winners and losers among industries, job categories, or immigrants.
If there are more requests than available green cards, Congress could consider a limited points system or an auction that again would place emphasis on the market. For example, a company’s offered compensation to the immigrant would have significant priority, as compensation provides objective evidence of market demand. Other heavily weighted factors could include financial resources and assets, educational achievement, professional credentials, job experience, and fluency in English. These factors, while not perfect or completely objective measures, would focus on reasonable measures of economic and fiscal impact, avoiding both government micromanagement and burdening American taxpayers with higher levels of government welfare assistance.
One way to ensure that merit-based green card candidates are indeed working or otherwise providing significant benefit to the U.S. would be to make their legal permanent residence conditional for the first several years. To transition from a conditional lawful permanent resident (LPR) to full LPR status, immigrants should be required to maintain employment for most of the conditional period, although they would be allowed to switch jobs. The total period of time required to hold a green card before becoming a citizen—five years—would remain unchanged, but a requirement that the holder not be a public charge before becoming a U.S. citizen could be added.
Focus on the nuclear family and end chain migration. Congress should allow the number of immediate relatives granted residency to remain uncapped while restricting the definition of immediate relatives to spouses and minor children. Congress should cut all or almost all of the current family preferences for extended family, thus ending chain migration. U.S. citizens could continue to sponsor their parents, but only for a renewable temporary visa that would not make them eligible for welfare benefits and that would require the citizens to provide proof of health insurance and financial support of their parents. It is also worth noting that extended family members may have other legal avenues for immigrating to the U.S.
End the Diversity Immigrant Visa (“Lottery”) Program. Congress should eliminate the Diversity Immigrant Visa (DV) Program, which provides 50,000 immigrant visas annually to random individuals from countries with low rates of immigration to the United States. The United States should evaluate potential citizens individually. Rather than leave to chance the question of who gets an immigrant visa, Congress should decide based on the qualifications of potential citizens, taking into consideration experience, professional credentials, and education. The Diversity lottery treats people not as individuals, but as the means to artificially create representation from various countries. Congress should end this system because it does not serve the national interest and discriminates based on national origin.
End per-country immigration caps. Under the Immigration and Nationality Act, immigrants are subjected to a per-country ceiling or cap. The arbitrary per-country caps should be eliminated and replaced with a system that serves the national interest. Over the years, numerous proposals have been introduced in Congress to revise or eliminate the per-country ceiling on the number of people granted employment-based lawful permanent residency. Eliminating this cap could be done in a number of ways. H.R. 392, which was introduced in 2017 by then-Representative Jason Chaffetz (R–UT) and eventually gained over 300 cosponsors, is one example. H.R. 392 would have eliminated the per-country “limits for employment-based green cards, while doubling the limits for family-based immigrants.”
End universal birthright citizenship. The granting of birthright citizenship to all children born in the United States regardless of the parents’ immigration status is the result of a misinterpretation of the Fourteenth Amendment and is inconsistent with the intent of the amendment’s framers. The legislative history of the amendment makes clear that its purpose was to bestow citizenship only on those who owed their permanent, undivided allegiance to the United States and were subject to the fullest extent of its jurisdiction. In particular, this meant the newly freed slaves, who were lawful and permanent U.S. residents and not subject to any foreign power. Congress should clarify the federal definition of “citizenship” in a manner that conveys its consistency with the original understanding of the Fourteenth Amendment by explicitly stating that only the U.S.-born children of individuals subject to the complete jurisdiction of the United States are citizens by virtue of birth on U.S. soil. This would include the children of lawful permanent resident aliens referred to in United States v. Wong Kim Ark, but would exclude the U.S.-born children of illegal or temporarily present aliens.
Promote patriotic assimilation. Policymakers should overhaul policies that do not blend well with immigration. Concepts such as victimhood, oppressor–oppressed, compensatory justice, racial preferences, coercive diversity, etc., are harmful and should not govern policy. Congress must put an end to measures that coerce immigrants and their American children and grandchildren into pan-ethnic identity traps. We must stop categorizing people as victims with protected status, and we should start mandating that they participate in all aspects of society. Immigrants come to the United States to be American, not to join synthetic nations within the nation. The executive branch should stop dividing society into groups by rescinding the 1977 Office of Management and Budget (OMB) directive, and its 1997 revision, that divides the population into “Hispanics,” “Asians,” etc., and the courts should finally declare racial preferences in admissions and government contracts to be unconstitutional.
Candidates for citizenship should demonstrate a strong understanding of America’s language, history, and civic life. The patriotic rituals surrounding the naturalization ceremony should be augmented to reinforce the transformational character of the event. Once immigrants go through naturalization, they are expected to have no other national loyalty, whether to the lands of their birth or to a “nation within a nation.” The government should return to the guiding principle that once an immigrant is naturalized, he or she should be encouraged, in George Washington’s words, to “get assimilated to our customs.”
Public schools should reinforce these values and should not use “culturally responsive” teaching methods (used to teach even math), which divide children into different ethnic boxes. Rigorous studies indicate statistically significant positive effects of school choice or private schooling on the teaching of civic values, while the civics education provided by public schools is currently falling short. Government schools must do a better job of instilling civic values, and policymakers at the state level should provide more charter schools and private school choice options for families.
Fact: Many countries around the world successfully use a merit-based immigration system to advance their national interests.
Fact: Unlimited birthright citizenship is not required by the Constitution and is harmful to an effective immigration system.
Fact: Assimilation and Americanization is an essential correlate to immigration.
America’s Founders believed that the purpose of government is to secure inalienable rights such as life, liberty, and the pursuit of happiness, and they designed a system of government to further that purpose. This system limits government in several ways, such as separating government power into three branches, with checks and balances between then, and dividing it between the federal and state levels of government.
The design of this system of government helps define the role of each of its components, and those roles must be maintained for the system to achieve its purpose. To this end, not only is power separated into the three branches and divided between the federal and state levels, but the Constitution also gives separate and distinct powers to each branch. Alexander Hamilton wrote that the exercise of these powers would involve will (the legislative branch), force (executive), and judgment (judicial). Since the judicial branch is limited to using judgment in interpreting and applying the law to decide individual cases, Hamilton explained, it would be the “weakest” and “least dangerous” branch. This separation of powers, in both theory and fact, is so important, he wrote, that liberty itself depends on it.
As the Supreme Court explained in 1795, the Constitution contains “the permanent will of the people, and is the supreme law of the land; it is paramount to the power of the Legislature.” Some cases therefore require that the court evaluate whether laws enacted by the legislative branch are consistent with the Constitution, a process often referred to as “judicial review.”
While the Marbury v. Madison (1803) decision established the practice of judicial review, it did not relieve the legislative and executive branches of their independent responsibility to evaluate the constitutionality of their own actions. For example, when Congress makes a decision about which laws to enact, it is interpreting the Constitution. When Members of Congress reject legislation that would violate the Constitution, they are acting in accordance with their oath.
Similarly, the President carries out this oath by determining which bills to sign into law. The President may sign or veto legislation for political or policy reasons, but faithfully discharging his oath may also require vetoing legislation he believes would violate the Constitution. He (or she) may also choose not to enforce a law signed by one of his predecessors if he concludes that it is unconstitutional. The responsibility of each branch to ensure that its actions are consistent with the Constitution is always a present duty.
America’s Founders designed a system of government in which the judiciary must exercise its judicial power, especially judicial review, in a particular way, and not as the sole actor. With the Supreme Court taking the lead, however, the judicial branch has recently been pushing past those limits and has expanded its power beyond the design intended for it. In Cooper v. Aaron (1958), for example, the Court asserted that “the federal judiciary is supreme in the exposition of the law of the Constitution.”
This trend has had several effects that undermine the liberty our system of government was designed to provide. It has, for example, invited the other branches to ignore their independent duty to abide by the Constitution, and to act as though they are free to do what they choose, in whatever manner, unless or until stopped by the courts.
Not only has the judiciary proclaimed its superiority to the other branches in interpreting the Constitution, but it has also radically changed how it conducts that interpretation. Founder James Wilson, a signer of both the Declaration of Independence and the Constitution and one of the original six Supreme Court justices, explained that, in a republic, “the people are masters of the government.” As a result, President George Washington said in his 1796 farewell address, the “basis of our political systems is the right of the people to make and to alter their constitutions of government.” And, returning to Marbury, the Supreme Court emphasized that the Constitution is written so that the limits it imposes on government “may not be mistaken nor forgotten.”
If these principles are true, then they should direct how judges go about interpreting and applying the law: A judge should use the Constitution, as written and originally understood, to conduct judicial review, and not a constitution of the judge’s own making, with the meaning a judge wants it to have. Judges are limited, as the Supreme Court said in Marbury v. Madison, to “say[ing] what the law is,” and the Constitution is not, as Chief Justice Charles Evans Hughes would say a century later, “whatever the judges say it is.”
These principles apply as much to the judicial branch as to the other two branches. Judges therefore may not treat the Constitution in a way that takes control of the Constitution away from the people. For this to be a “government of laws and not of men,” as John Adams put it, the law, not judges themselves, must decide the cases and controversies that come before the courts.
In determining whether a contested law is consistent with the Constitution, judges act within their proper judicial power when they give effect to the original public meaning of the words and phrases of laws and the Constitution. A law’s compliance with the Constitution is no guarantee of its soundness or wisdom. In fact, judges acting in accordance with their constitutional duties will at times uphold laws that may be bad policy, while striking down laws that may be good policy. Judicial review requires the judge to determine not whether a law leads to good or bad results, or accords with his or her personal views or priorities, but whether that law violates the Constitution.
The opposite approach is often called “judicial activism,” in which judges use whatever process or method necessary to achieve their desired result. This approach might be described as “the political ends justifying the judicial means.” A judge who employs judicial activism might ignore the law’s text or its original public meaning, relying on external sources such as foreign law, and might even fail to apply the law impartially. This is also sometimes called “living constitutionalism,” a theory in which the meaning of the Constitution itself evolves and changes, not through the amendment process set out in the Constitution itself, but as a result of judicial decisions driven by the priorities and preferences of judges.
The following examples of Supreme Court activism, which involved high-profile issues, have garnered significant media attention:
In contrast, a judiciary exercising its power as designed would decide each case in light of what the Constitution and the statutes say, and what they originally meant, applying them impartially to the facts. Such judges respect the American people’s right to control the Constitution, to elect representatives who enact statutes, and to remain masters of the government.
Policymakers should pledge to promote the appointment of constitutionalist judges. Policymakers should pledge to promote the appointment of judges who will follow the design for the judiciary by interpreting the law as written and impartially applying it to decide cases. This means that the President should nominate—and Senators should confirm—only faithful constitutionalists.
Senators should prioritize determining whether judicial nominees will be committed to the judiciary’s role as designed. In exercising their “Advice and Consent” role, which is a check on the presidential power to appoint new judges, Senators must determine whether nominees are qualified for judicial service. These qualifications include not only appropriate legal experience, but also the proper judicial philosophy. Senators should seek to determine a nominee’s understanding of the power and proper role of the courts in our system of government, and the process or method a nominee will follow to interpret and apply the law in their cases.
Questions such as the following should inform the confirmation process: Does the nominee decide cases involving specific parties and particular facts, or does he or she address issues and solve broad problems? Does the nominee believe in interpreting the Constitution according to the original public meaning of its text, or does he or she believe that new meaning can be found from other sources, including foreign law? Ought judges to take into account the political interests that might be served by their decisions?
Senators should not abuse their role of “Advice and Consent.” The Senate advises whether the President should appoint someone he has nominated by giving or withholding consent. This does not mean, however, that the Senate has a co-equal power of appointment; and the Senate should not use procedural tactics that effectively highjack the President’s power to appoint judges.
Fact: Courts with judges who serve unlimited terms have a total of 860 seats around the country.
Fact: On average, judicial appointments barely exceed new judicial vacancies.
Fact: Judicial vacancies have remained a problem, compromising the judiciary’s ability to serve its purpose.
The issue of illegal immigration has been at the forefront of significant political and policy battles for the past decade or more. To deal with this problem, three aspects of illegal immigration must be understood: illegal immigration at the border and through visa overstays, and inadequate interior enforcement to catch and remove those in the U.S. illegally.
Over the previous two decades, the U.S. experienced a declining number of illegal immigrants at the U.S. southern border. The number of border patrol agents had significantly increased, border barriers were increased, and fewer immigrants were able to sneak across the southern border. That trend changed, beginning in 2014, when smugglers and immigrants began to exploit major loopholes in U.S. immigration law, which has, at times, overwhelmed border enforcement. In recent years, anyone showing up at the border, either crossing illegally or attempting to come through a port of entry, could bring a child, and the resulting “family units” were almost immediately released into the interior of the U.S., per the Flores ruling loophole. Successful exploitation of the catch and release loophole encouraged tens of thousands more illegal immigrants to come to the U.S., resulting in an historic surge at our southern border. Most claimed asylum, and, although many can say the right words to pass the initial “credible fear” screening, only around 12 percent will be granted asylum in the end.
While proper border infrastructure, barriers, and resources are important to catch illegal immigrants, the Flores loophole, weaknesses of the well-intentioned Trafficking Victims Protection Reauthorization Act, and an easily gameable asylum system have overwhelmed the ability of U.S. Customs and Border Protection to operate and control the southern border.
A second aspect of illegal immigration is the long-standing issue of visa overstays. Before this recent surge at the border, most illegal immigrants were visa overstays, i.e., they legally entered the U.S. on a visa or other form of entry and then failed to leave when their visa or authorization expired. To counter this kind of illegal immigration, interior enforcement tools are needed.
Finally, approximately 11 million illegal immigrants currently reside in the U.S. The left argues in favor of amnesty for these immigrants who have broken the law, but amnesty would be unfair to Americans and legal immigrants, would encourage more illegal immigration by rewarding it, and would fail to solve the root causes of illegal immigration. While removing all illegal immigrants is infeasible, better immigration enforcement, both at U.S. borders and in the interior, would encourage existing illegal immigrants to return to their home countries and deter additional illegal immigration.
Implement effective border security. Congress must appropriate funding for cost-effective border security measures paired with robust enforcement. The U.S. must build a system that welds all of the nation’s border assets into a single, coherent security enterprise that deploys the right asset to the right place at the right time. This would require key investments in border infrastructure, organization, technology, and resources. These initiatives include such controversial but essential tools as additional border “wall,” expanded detention space, and (as required) the temporary and efficacious use of support from the Department of Defense.
Provide more funding for Coast Guard acquisitions. This would ensure that the Coast Guard can acquire the right mix of vessels, including Fast Response Cutters and Offshore Patrol Cutters, as well as appropriate unmanned aerial systems.
Align U.S. assistance funding levels to Mexico with U.S. national security interests. A safer and more prosperous Mexico would reduce the security threats to the U.S., lessen the impact of some of the drivers behind illegal immigration, and allow both countries to focus on productive matters in their bilateral relationship. Yet U.S. assistance to Mexico in the form of the Merida Initiative has decreased from an all-time high of $639.2 million in fiscal year (FY) 2010 to $130.9 million in FY 2017.
Assess the efficacy of the Central American development package, the U.S. Strategy for Engagement in Central America. Following the 2014 unaccompanied-minor crisis at the U.S. southern border, the U.S., El Salvador, Guatemala, and Honduras launched this program to address the factors driving illegal migration in the region. Guatemala’s northern neighbor Mexico collaborates with the U.S. in an effort to mitigate these shared challenges. The volume and frequency of illegal immigration toward the U.S. indicate a shortcoming. Congress should request impact reports from implementing agencies that gauge whether the programs are meeting their intended objectives.
Adjust the asylum claim process. Congress can improve the asylum system in many ways. Rather than applying for asylum at U.S. borders, asylum seekers travelling to the U.S. southern border should be required to have their asylum claims heard by a U.S. Citizenship and Immigration Services (USCIS) asylum officer at a U.S. consulate in Mexico or in another country in Latin America. Interviewers should also ask the asylum seeker why he or she did not assert asylum in another country. Immigration officials should consider failure to explain the refusal to pursue asylum in another country in making their decision. Congress could also consider new standards that make it harder for illegal border crossers to claim asylum, especially at U.S. borders. The Administration should also continue to pursue safe third country agreements and strengthen other agreements with countries in Latin America to promote better control of the asylum process.
Close the loopholes. Congress should reject the Ninth Circuit’s recent interpretation of the Flores settlement. Flores has been interpreted to require the Department of Homeland Security (DHS) to release from its custody all children, even if they are with a parent or parents, within 20 days. Since the asylum process takes longer than 20 days, the government is left with the choice either to detain the parent and release the child, or to release both the parent and the child. Congress should legislate to allow accompanied children to remain with their parents while they are awaiting asylum adjudication or prosecution of misdemeanor violations of immigration law.
Strengthen immigration enforcement. U.S. laws must be enforced if additional illegal immigration is to be deterred. The U.S. should judiciously increase the number of Immigration and Customs Enforcement (ICE) agents; expand the 287(g) program that trains and deputizes state and local law enforcement officers to assist ICE in enforcing U.S. immigration laws; curb sanctuary cities; expedite removals of illegal immigrants caught at U.S. borders; streamline the removal process; increase resources to immigration courts; and ensure that aliens show up at court hearings by maximizing the use of detention facilities and alternatives to detention.
Give immigration law judges summary judgment and contempt authority. As of October 24, 2018, 786,303 immigration cases were pending in immigration courts, up from 186,090 in 2008. During that same 10-year period, the average wait time for the disposition of a case in immigration court went from 438 days in 2008 to 718 days in 2018. This is unacceptable and must change. One of the main reasons for the excessive backlog is the fact that immigration judges do not have the summary judgment authority that is common to federal and state court judges. Summary judgment authority allows judges to refuse to schedule cases that lack legal merit, but because immigration judges do not have that authority, meritless cases clog the dockets. Congress should amend existing statutes to give immigration judges this authority.
Do not grant amnesty. Amnesty undermines the rule of law and encourages more unlawful migration. Grants of amnesty, in whatever form, to aliens who knowingly enter or remain in the U.S. discourage respect for the law, treat lawbreaking aliens better than law-abiding aliens, and encourage future unlawful immigration into the United States. If America were to suddenly award legal status to aliens unlawfully in the United States, it would be treating them better than aliens abroad who follow America’s immigration procedures and patiently await a visa authorizing them to come to the United States. Such action—as past amnesties have proved—would also spur more aliens to enter or remain unlawfully in the United States in the confident expectation that Congress will continue to enact future amnesties that provide a shortcut to legal status. The government should pursue a measured set of approaches to a wide variety of immigration issues, but above all, it should exclude amnesty for aliens unlawfully present in the United States.
Fact: There is a crisis at the border.
Fact: DHS enforcement resources have grown since 9/11 but have been undermined by bad policy.
Fact: Interior enforcement is critical to address all aspects of illegal immigration.
Cyberspace has enabled great prosperity and innovation, encompassing almost every aspect of modern life. But along with it come danger and vulnerabilities. The cyber challenge to the United States is dynamic and shifting, and there is a great deal of confusion about what developments in cybersecurity mean. One thing is clear: The U.S. must, without causing harm, do more to secure its networks.
The efforts that policymakers have made to respond to the cyber challenge thus far have not been enough. The ever-changing nature of the threats and vulnerabilities in the cyber domain is part of the problem, making speed and innovation essential—two things with which public policy often struggles.
Cyber security is largely a bipartisan issue. Many cyber bills receive either bipartisan support or bipartisan opposition. Federal regulatory powers and the role they should play in cybersecurity are a primary area of contention. Given the dynamic and fast-moving nature of cyber threats, the regulatory approach is often too slow and clumsy to adequately address the real issues, and new problems often arise out of the regulations themselves. Relying on regulations could also foster a culture of compliance, giving a false sense of security against enemies who are quick, smart, and persistent.
Nation-state hackers are the most serious cybersecurity challenge the U.S. faces, with Russia presenting the most sophisticated cyber threat and China a close second. In an era of renewed great power competition, cyber is a new battlefield on which nation-states are seeking to exploit vulnerabilities. The U.S. has indicted Russians in efforts to hack U.S. political entities such as the Democratic National Committee. Russian hackers are also believed to be behind multiple cyberattacks that took down portions of Ukraine’s electric grid in 2015.
China has jump-started its economic efforts by rampant theft of commercial intellectual property across many sectors of the economy. For example, it was revealed this past year that Chinese hackers targeted sensitive cancer research at multiple institutes in the U.S., in addition to other attacks aimed at U.S. intellectual property.
Iran and North Korea are much less sophisticated than Russia and China, but have strong cyber warfare assets that allow them to punch above their geopolitical weight class. The 2012 so-called “Shamoon” virus unleashed on the Saudi Aramco oil production company, for instance, was a brute-force attack by Iran that destroyed 30,000 computers. In 2019, Iranian hackers continued to target hundreds of universities around the world, including some in the U.S., in an operation termed “Cobalt Dickens” designed to steal intellectual property.
North Korea has conducted high-profile cyberattacks against the U.S., the most notable being the attack launched against Sony Entertainment in 2014, allegedly over a movie depicting North Korea in a negative light. The hackers took terabytes of private data and released confidential information, including five undistributed Sony movies, to the public. North Korean hackers were also suspected of attempting to steal credential information of individuals working on North Korean issues at the United Nations and non-governmental organizations in 2019.
In addition to these nation-states, cyber criminals, hacktivists, and terrorists all seek to use cyberspace for their own ends.
To address this growing threat, the U.S. should leverage the forces of the market, motivating the private sector to make the sort of continual and dynamic investment needed to secure the country’s diverse cyber networks.
Create a new strategy for U.S. global efforts in cyberspace. The U.S. needs to articulate a bolder strategy for how it will operate in the cyber domain. From deterring and retaliating against cyber aggressors to reinforcing cybercrime defense efforts with allies, the U.S. should craft a new, detailed strategy that will direct the whole of government to protect U.S. interests in cyberspace. This strategy must also consider the central role the private sector plays and make use of its expertise and skills.
Develop a robust policy of deterrence that tailors a proportionate U.S. response to bad actors. Deterrence is in the mind of the adversary, who chooses to alter his behavior if he believes the costs are too high or the benefits too small. To achieve deterrence in cyberspace, the U.S. must establish a clear pattern of policy and action that leads an actor to rethink his plans. The U.S. has a whole host of tools it can use to retaliate against any sort of cyber aggression, including diplomatic naming and shaming, cutting off cooperation, visa restrictions, commercial and financial limitations, sanctions, legal action, trade enforcement tools, action on other military or foreign policy matters, support to dissidents in malicious cyber states, and other tools not considered here. These tools should be used in a way that is tailored to fit the adversary and proportionate to the scale and effects of his aggressive action.
Restrict military cyber cooperation with Russia and China. Congress should restrict the Department of Defense from spending any money on any activity where the primary purpose is to engage in cyber cooperation with Russia and China. An exception can be made for so-called hotlines or other emergency communications, but broader cooperative efforts should be forbidden.
Increase cooperation with allies and partners. Many cyber-attacks and incidents cannot be punished, and may require stronger defenses and cooperation to defeat or mitigate. The U.S. should pursue deeper technical, legal, and policy cooperation with its allies and partners.
Prepare to fight in the cyber domain with allies. The U.S. and its allies also need to develop the tools and capabilities to fight in the cyber domain. While NATO has taken some steps in this direction, far more needs to be done. Any future conflict will require offensive and defensive cyber capabilities that are well integrated into U.S. and allied warfighting strategies. Creating such capabilities requires a political will to engage in this new domain as well as the resources to develop the means of engagement.
Share threat information with industry. U.S. government concerns about Chinese technologies and related services cannot be expressed exclusively in classified or other constrained environments. If the U.S. government wants industry to operate in ways that do not provoke national security concerns or make them worse, the government must share its telecommunications security concerns in a detailed and easily disseminated manner.
Determine disqualifying factors. The U.S. government should clearly communicate with industry and with America’s foreign partners and allies—as well as with the Chinese—which legal frameworks, activities, and business practices will result in exclusion from U.S. 5G infrastructure, services, and other emerging technology integrations. Further, the U.S. should encourage other nations to adopt these standards as a way of maintaining pressure on countries and companies working against U.S. and allied interests.
Block vulnerabilities. The U.S. should block any foreign technology from U.S. markets that creates vulnerabilities in critical infrastructure or that provides hostile foreign actors with “backdoors” to U.S. data. Doing this would impose significant pressure on China and others to improve poor security practices, and it would spur domestic security research in the U.S. that would incrementally improve the safety of the hardware used by the United States, as well as the software supply chains into the U. S. The U.S. should encourage the remaining four Five Eyes countries—Australia, Canada, New Zealand, and the United Kingdom—to implement similar exclusionary measures.
Block untrusted companies. The Committee on Foreign Investment in the United States should block foreign companies from U.S. investments if they have a history of producing hardware or software with known vulnerabilities. This would be especially helpful in mitigating the challenge of Chinese investment in, and purchase of, American start-ups that might embrace poor security practices in return for rapid access to capital.
Prepare for “zero-trust” networks. Currently, Huawei controls approximately 30 percent of the global mobile communications market and could win as much as 50 percent of the global 5G market. Even if the U.S. is able to secure its own wireless networks from foreign spying and interference, the vast majority of networks around the world will be developed and managed by the Chinese. This requires the U.S. defense and intelligence communities to begin mitigating this threat and developing new networking strategies that will allow the U.S. to operate and thrive in a “zero-trust” environment—meaning operating on networks that are owned and managed by China or other hostile actors. While it is too soon to cede 5G to U.S. challengers, it is prudent to begin preparing for worst-case scenarios.
Continue to invest in U.S. Cyber Command to strengthen the U.S. ability to engage in cyber warfare and protect Defense Department and critical infrastructure networks. Cyber Command should continue to grow and mature into a premier cyberwarfare organization to enhance the offensive and defensive cyber capabilities of the United States. These capabilities are important for increasing the ability to deter adversaries.
Deepen collaboration on cybercrime among like-minded nations. The U.S. should look to create an acceptance for active cyber defenses that are not harmful, but allow better attribution of, and intelligence on, cyber threats. Laws and tools from the organized crime arena, such as RICO, should be expanded to cover transnational criminal organizations engaging in cybercrime.
Expand cybercrime cooperation beyond current signatories of the Budapest Convention. The U.S. should create a cyber forum of the Financial Action Task Force (FATF) that combats money laundering and financing of terrorism. While they need not abide by all the terms of the Budapest Convention, non-signatory countries should still be pressured to take reasonable actions against cybercrime. Nations that do not assist in international cybercrime investigations, or that do little to stop cybercrime within their territories, should be considered non-cooperative and face repercussions from members of the new cyber task force.
Encourage the private development of cybersecurity supply chain ratings and accreditation. Such a framework would contain different tiers or ratings for different levels of accreditation, ranging from minimal overview of a company’s supply chain to in-depth analysis of specific products’ supply chain features. These different levels of accreditation would provide consumers with more information to make risk-based decisions. Additionally, producers would find such accreditation valuable for sales, thus connecting security and a profit incentive. Instead of mandating cybersecurity solutions, the U.S. government should collaborate with the private sector. One way to encourage the adoption of this system would be to require government agencies that deal with large amounts of sensitive data, or have security-related duties, to purchase technology only from organizations that are accredited by this cyber supply chain ratings system.
Improve sensitive government and military cyber supply chain procedures. U.S. Government Accountability Office (GAO) reports and news accounts indicate that the government needs to improve its supply chain procedures for technology products. Such improvements should include the requirement that no technology for use in U.S. national security systems be purchased from Chinese companies. Additionally, government agencies should be required to consider supply chain ratings when adding technology goods into their acquisition processes.
Enhance cyber resilience. In critical government systems, hardware that monitors itself for hardware attacks and other redundancies should be considered. Though such hardware is likely to be more expensive, this premium would be a way for the U.S. to protect its most important systems. For agencies with less sensitive systems, the U.S. should consider expanding cloud computing to gain access to rapidly scalable and quickly available computer resources as a way to enhance resilience and continuity of operations at low cost.
Fact: Cyberattacks and espionage are costly to the U.S. and global economy.
Fact: China, Iran, North Korea, and Russia, as well as hacking groups working with these countries, continually attack U.S. economic interests and critical infrastructure. The United States must implement an all-tools-of-national-power approach to dealing with these bad actors.
Protecting the U.S. homeland requires managing risk posed by a wide variety of human and natural threats. Transportation security, disaster response, vetting of immigrants and visitors, and providing security, assistance, and rescue in U.S. waters and beyond—these are just a few of the critical missions carried about by the Department of Homeland Security (DHS) every day.
In 2020, DHS has the added responsibility of responding to the COVID-19 pandemic. U.S. Customs and Border Protection has implemented travel restrictions from countries with large COVID-19 case numbers, including across our land borders per joint agreements with Canada and Mexico. The Countering Weapons of Mass Destruction Office, which houses DHS’ Chief Medical Officer, has conducted enhanced health screenings at designated airports to support the Centers for Disease Control and Prevention. The Federal Emergency Management Agency (FEMA) has delivered personal protective equipment and medical beds throughout the country and coordinated air flights to address medical shortages. In addition, the Cybersecurity and Infrastructure Security Agency has monitored America’s cyber and critical infrastructure, including warning organizations researching the virus of the People’s Republic of China’s likely targeting and network compromise in attempt to steal COVID-19 vaccine and other research.
The U.S. Coast Guard (USCG) faces the issue of having been chronically underfunded during the Obama Administration. Since then, the USCG has received more appropriate funding, but more is necessary to update its fleet. For example, the USCG has only one medium icebreaker, and one heavy ice breaker, the Polar Star, which was launched in 1976 and is well past its 30-year service life. In less chilly waters, the USCG also needs a full complement of offshore and fast response cutters to update its aging fleet and to conduct security and safety missions on the seas and waterways. Completing the current shipbuilding plan would give the USCG only the bare minimum fleet it had recommended and would not be sufficient to effectively carry out all of the Coast Guard’s missions.
Disaster response also suffers from resource problems, as well as a misplaced source for financial relief. The FEMA Disaster Relief Fund and National Flood Insurance Program (NFIP) have frequently run out of funds or run vast deficits requiring a taxpayer bailout. Disaster relief policies have shifted responsibility away from individuals and local governments (where it should lie) and onto the federal government and all taxpayers instead. This discourages state and local governments from taking common sense precautionary steps to mitigate the impact of natural disasters. And since the bar to qualify as a designated disaster is very low, states rely too heavily on FEMA after a disaster occurs so that states are less prepared for large disasters before they strike. Similarly, the NFIP subsidizes flood insurance policies, which means that it consistently runs a deficit and encourages building and rebuilding in higher risk, flood-prone areas.
Following 9/11, it was clear that more needed to be done to address the threat of terrorist attacks using airplanes. But today it is also clear that the Transportation Security Administration (TSA) is in need of reform. The TSA not only sets security rules, but also employs the workforce that carries out those rules, which is not a design for good governance or fiscal responsibility. Most advanced economies have a security agency that sets the rules and performs oversight, while security contractors do the screening. The U.S. should privatize the TSA to increase accountability and save limited homeland security dollars. Similarly, more should be done to protect Americans from the threat posed by hostile and wayward aerial drones.
DHS is also responsible for ensuring the security of the U.S. immigration system, and the Visa Waiver Program (VWP) is a critical tool in that endeavor. The program allows visitors from VWP countries to visit the U.S. for short stays without a visa. This does not mean that there is no security: The program involves almost the same security procedures as a traditional visa. In addition, to join the program, countries have to share intelligence on known and suspected terrorists, serious criminals, and lost and stolen passports. This intelligence helps the U.S. better vet all visitors to the U.S., while the VWP increases trade and tourism and enhances our diplomatic relationship with partners around the world.
Invest in the Coast Guard. The USCG fulfills many missions at home and around the world, but does so with a fleet that is in great need of updating. Congress should provide consistent funding to the USCG to allow it to complete its program of record. Congress should also demand a comprehensive review of the program of record to identify what capabilities the USCG needs going forward to complete its missions.
Reform FEMA and Disaster Response. FEMA currently spends too much of its time focusing on relatively small disasters, leaving it less prepared for the “big one.” Similarly, much of the funding for such disasters comes from many different programs in the federal government. This should be reformed to push state and local governments to be more prepared for disasters in terms of funding, capabilities, and planning. Resilient, prepared communities are needed to help the U.S. cost-effectively bounce back from a disaster.
Privatize the TSA. The current model of the TSA does not effectively provide the aviation security that America needs. To increase accountability and save funding, Congress should privatize the TSA’s security screeners while leaving the TSA responsible for setting rules and providing oversight. Congress can look to the Canadian model of aviation security as a potential roadmap for reform.
Rename and judiciously expand the Visa Waiver Program. The Visa Waiver Program is, according to Administration officials, the “gold standard” of intelligence sharing and travel security. Unfortunately, its name suggests otherwise and should be changed to something such as the Partnership for Secure Travel to more accurately describe the program. Furthermore, the program should be judiciously expanded, looking first to countries such as Croatia and other allies.
Develop counter drone systems and rules. The number of unmanned aerial systems (drones) is increasingly rapidly. While there are many benefits from such technology, the U.S. needs to do more to protect itself from potentially harmful uses of drones. The Departments of Homeland Security, Defense, and Justice should be authorized to develop rules of engagement for counter drone operations, but it will take time to develop these rules and also field capabilities to detect and take down malicious drones. Congress must encourage and support these efforts while also looking to expand drone protection beyond just federal authorities: State and local law enforcement should be deputized and trained by DHS in counter drone operations to help protect more sites and facilities across the U.S.
Fact: The TSA is neither the best nor the only way to handle aviation security.
Fact: The Visa Waiver Program is good for U.S. vetting, economic prosperity, and diplomacy.
Fact: Use of drones is dramatically increasing, and so is the need to protect against their malicious use.
The federal government alone, obligated by the U.S. Constitution, provides for the defense of the United States and its interests. Americans expect the military to fulfill its mission to defend our country and to protect our national interests at home and abroad. They understand that a strong America garners respect, gains friends and allies, enjoys strong economic and trading relations with more countries, and deters bad behavior by its competitors and enemies. Conversely, Americans understand that a weak military reflects poorly on our country and undermines the other things we want our country to do and to represent.
A weak military incentivizes competitors to act boldly and more aggressively because they have less concern that the U.S. can impose any sort of cost or prevent them from imposing their will on others. A military that is ready, capable, competent, and large enough to defend U.S. interests globally both reflects American confidence and contributes to it. It signals to the world that the U.S. prioritizes ensuring its interests can be defended.
Military readiness can be measured in many ways, and it means many things; all of the aspects of readiness contribute to whether a military force wins in battle. Individuals are “ready” if they are properly educated, trained, and equipped. Readiness can be viewed as a measure of a unit’s or force’s equipment: If a specific percentage of necessary equipment is on-hand and in working order, the unit is “ready” by that measure. Readiness is also a function of how the force is postured: where it is physically located in proximity to anticipated threats, whether it has operational employment concepts that are relevant to anticipated battlefields and opponents, and whether the constituent parts of the force—ground units, aviation squadrons, battle groups at sea, space and cyber units, special operations elements, supporting logistics organizations, and the network of surveillance, intelligence, reconnaissance, and headquarters units that binds everything together—are competent at working together to accomplish tactical and operational objectives. The force can be fully manned, equipped, and individually trained, but if it has not practiced together to a level that ensures effectiveness, all of the other aspects are meaningless.
Military readiness means all of these things, and all of them require funding, time, and sufficient capacity such that the overall force is able to train even while parts of it are operationally committed. A force cannot be made ready overnight, and it is too late to get ready once a crisis has emerged. Readiness is the product of sustained and intentional investment in defense. It is expensive, but much less expensive than a lost war, lost markets, and lost influence.
Support Army modernization priorities. The Army has carefully assessed the implications of a “return to great power competition” and realizes it must improve its ability to fight a capable opponent at increased ranges and on a more lethal battlefield. It is investing in long-range precision fires (improved artillery and rocket capabilities); next-generation combat vehicles (its current fleet of equipment was introduced 20 to 30 years ago); future vertical lift platforms (current helicopters are limited in range, speed, and payload); Army network systems (modern forces require improved ability to manage and share information); air and missile defense (critical counters to advances being fielded by competitor militaries); and soldier lethality (each individual soldier needs to be better equipped and trained to fight and win on a future battlefield).
Sustain support for Army efforts to improve readiness. The Army fights as a total force, integrating Active, Guard, and Reserve units into a coherent whole. Active units may be the first to respond to a crisis, but their ability to sustain operations depends on augmentation and reinforcement from the reserve component. Consequently, the Army needs greater resources to ensure all of its units have access to its premier combat training centers on a more frequent and regular basis.
Commit to major investment in naval shipyards. Over its history, the Navy has operated 13 naval shipyards; today it operates only four, the oldest (Norfolk) established in 1757 and the youngest (Pearl Harbor) in 1908. Facilities are in disrepair, lack adequate pier and drydock space, have outdated support equipment, and employ a small workforce, all of which contribute to substantial backlogs in ship maintenance, leading to lost steaming days (fewer ships available for use) and increased costs once a ship is inducted for maintenance. Private (commercial) shipyards are contracted to perform much of the Navy’s ship maintenance, but some actions can only be performed by the Navy’s yards.
Increase funding for ship construction. The Navy is in dire need of increased funding for its shipbuilding account. It is faced with increasing costs in ship construction; decreasing shipyard availability to repair the ships it has (leading to increased costs); the smallest fleet since prior to World War I; and growing challenges abroad as China aggressively builds its own blue-water navy (at 300 ships, now outnumbering the U.S. Navy and projected to comprise 350 ships in just a few years) and countries like Russia and Iran equip their ships, maritime patrol aircraft, and mobile land-based vehicles with more capable anti-ship missiles. At current and projected levels of spending, the Navy does not expect to reach the minimum fleet size necessary to perform its role within the Joint Force until the mid-2030s. Ship manufacturers, the yards conducting related maintenance, and the web of suppliers that provide the parts and materials needed for new ships could expand capacity if there were some level of assurance that future work would offset the upfront costs of expanding facilities and hiring more workers. As things stand, constrained ship- building budgets and volatility in funding even for current contracts have made manufacturers and suppliers risk-averse. This impacts all ship classes, from a desperately needed small surface combatant to logistics support vessels, destroyers, and the new ballistic missile submarine meant to replace the aging Ohio-class.
Support Marine Corps procurement of ground and aviation platforms. The Corps is making good progress in fielding the amphibious combat vehicle (ACV), the replacement for the Vietnam-era amphibious assault vehicle (AAV). But the ACV was always meant to be an interim solution bridging the retirement of the AAV and the introduction of a true replacement capability, the ACV complementing rather than fully replacing the AAV. Initial fielding has received rave reviews, and this program needs to be maintained, if not accelerated. In a similar manner, the Corps’ program to replace its heavy-lift helicopter (the CH-53E being replaced by the CH-53K) is critical to the Corps’ operational viability, given the increased weight of nearly all ground systems/vehicles as weapons lethality has driven the need for better armor protection. And the AV-8B Harrier, fielded in the 1980s, is to be replaced by the F-35B, thus the necessity to ensure appropriate funding is sustained to accelerate the acquisition of this aircraft that provides fixed-wing, close-air strike support and intelligence, surveillance, and reconnaissance (ISR) support to Marine forces in close contact with the enemy.
Fund consumables such as ammunition, fuel, and spare parts. A force becomes competent and confident through robust, realistic training. Pilots must fly, artilleryman must shoot, sailors must steam, and logistics specialists must have the means to move, repair, generate power and water, and provide a host of support to include medical and dental services. Military personnel should not become good at these skills in the heat of battle. But good training, undertaken with the necessary frequency and duration to build and sustain critical skills, is expensive—and it never ends. Too few dollars available for repair parts means that equipment is not available for training. Too little money for munitions and ammunition means that operators do not learn the reality of employing their weapon systems. And too few hours in the air or days at sea means that pilots and sailors are less prepared for combat with an enemy who will not provide second chances.
Commit to Base Realignment and Closure (BRAC) iteration. The Department of Defense has repeatedly emphasized the need to divest itself of bases, stations, and facilities that are no longer relevant to current and projected defense requirements. It makes no sense to continue to spend money on infrastructure that is old (thus requiring large sums of money to repair, maintain, and operate compared to modern, energy efficient facilities), poorly suited to support equipment, operations, and training demands that profoundly differ from those that existed when many bases and facilities were established 50 to 100 years ago, or geographically misaligned with force requirements that need to be adjusted to account for dramatic changes in the world.
Fact: The U.S. military must break out of a readiness and equipment availability slump decades in the making.
Fact: Over half of the ships in the Navy’s surface are 20 years old or older.
Fact: Nearly two-thirds of U.S. spending on defense goes to manpower, not equipment or training.
Fact: The nation is not spending enough on defense; criticism to the contrary ignores key critical factors associated with the demands of real-world combat in the modern age.
Fact: U.S. military presence has significantly declined since the end of the Cold War.
Fact: In spite of repeated pledges to improve, the vast majority of NATO members fall well short of defense investment goals.
The nuclear threat environment has grown more complex and, in some ways, more dangerous to Americans than it was during the Cold War itself. During the Cold War, the United States had to primarily worry about one large adversary, the Soviet Union. (China possessed nuclear weapons, too, but American decision makers and policy makers generally assumed that deterring a Soviet attack would deter a Chinese one by extension.) The dissolution of the Soviet Union, and the U.S. focus on relatively smaller scale conventional operations, resulted in U.S. policy makers losing sight of nuclear issues, even as new countries with nuclear weapons emerged: India and Pakistan in 1998, and North Korea in 2006. Iran has had a nuclear weapons program, and while the status of its current efforts is unclear, it remains a proliferation threat. The U.S. objective to deter a large-scale attack against the U.S. homeland and allies remains as important as ever.
Today, the United States is facing not only new actors with increasingly sophisticated nuclear warheads and means to deliver them, but also a return of great power competition with the revisionist and increasingly belligerent Russia and China. Russia, China, and North Korea have active and proficient nuclear weapons production complexes, unlike the United States. Russia and China are developing asymmetric capabilities to threaten the United States and allies, including in space and anti-access/area denial technologies to mitigate U.S. advantages in conventional precision strike. Since 2010, Russia has fielded new delivery systems: two ground-launched, four sea-launched, and one air-launched. China fielded three new ground-launched and two new sea-launched delivery systems. China does not provide transparency regarding its nuclear weapons development. Even North Korea has fielded four new ground-launched systems since 2010—all in comparison to the U.S., which has launched no new delivery systems.
Along with extensive new nuclear weapons modernization efforts, Russia appears to be adopting doctrines that indicate it might rely on using a low-yield nuclear weapon first in a conventional conflict to indicate resolve in order to prevent the United States from responding. Russia’s so-called escalate to de-escalate strategy seems to be driven by a mistaken belief that the United States would not respond to such nuclear weapon use because Russia has qualitative and quantitative superiority on lower levels of the escalatory level relative to the United States.
The United States has to worry not only about state actors and nuclear weapon technologies, but also non-state actors, as the case of Pakistani scientist A.Q. Khan and his network has shown. (A.Q. Khan was selling nuclear technologies on the black market to anyone willing to pay.) For decades, the United States has pursued policies that would keep the number of nuclear-armed states as small as possible–policies that would make it more difficult for state and non-state actors to obtain nuclear weapons and the means to deliver them.
America’s nuclear policy should account for negative developments in the threat area as well as for deterioration of the U.S. nuclear enterprise and the intellectual and physical infrastructure supporting it. Since nuclear weapons are the only weapons that can end life as we know it in an instant, Congress and the Administration should reenergize efforts to understand new developments in this area and their implications for U.S. and allied security.
Restore U.S. nuclear intelligence capabilities. For almost a decade, the United States has focused most of its intelligence collection resources on ongoing conventional operations in the Middle East. U.S. insights and ability to assess foreign adversaries’ nuclear weapons programs have deteriorated, partially as a consequence of this refocus. Congress and the Administration should work together to provide the proper resources for the U.S. intelligence apparatus to be more adept at understanding the nuclear weapon capabilities that adversaries are developing and what kind of knowledge and materials are being transferred to non-state actors. U.S. nuclear laboratories have a fundamental role in improving our understanding of the design of our adversaries’ weapons and their effects.
Ensure U.S. deterrence is effective vis-à-vis other nuclear armed states. The U.S. government must understand what deters nuclear armed states—including new nuclear armed states—and structure its defense and nuclear postures accordingly. New demands for deterrence can generate new weapon requirements, and the United State should approach these with an open mind, rather than with the naïve belief that U.S. unilateral disarmament and its lack of nuclear weapons modernization will incentivize other countries to give up their nuclear weapons.
Develop means of protection for the American public and allies. Missiles remain a delivery method of choice for U.S. nuclear-armed adversaries and competitors due to their short flight times and relatively low cost. The spread of these systems to countries like North Korea that threaten the United States and allies with ballistic missile attacks increases the imperative for the United States to develop a system capable of protecting the U.S. homeland and allies. The best way to protect what we hold dear is by developing and deploying a comprehensive, layered missile defense system, including interceptors in space, and a boost-phase intercept capability to shoot down incoming threats when they are most vulnerable.
Adequately fund U.S. nuclear weapons modernization programs and infrastructure supporting them. Washington should realize that modern and flexible nuclear weapons and infrastructure supporting them are the best way to ensure that adversaries continue to be deterred from attacking us and our allies. That is why Congress and the Administration must adequately provide for U.S. nuclear deterrent infrastructure, sustaining it into the future, including continued support for the deployment of a low-yield warhead on submarine-launched ballistic missiles.
Continue to assure allies. Just as the United States must think through new deterrence strategies for different nuclear-armed actors today, it must also think carefully about how it assures its allies, including those who face newly nuclear-armed states. Assurances are critical because they dissuade other countries from building their own nuclear weapons. For example, Japan and South Korea have both the technological ability and access to material to build their own nuclear weapons should they question U.S. commitment to their security. More nuclear-armed states would further increase the complexity of today’s nuclear landscape, contrary to U.S. interests and decades of nonproliferation policy goals.
Continue U.S. nonproliferation and counterproliferation efforts. The federal government must continue to support tools that make development and procurement of nuclear weapons or technologies enabling them more difficult and easier to detect by the United States, for example, a partnership with other countries through the Proliferation Security Initiative. Another example would be developing technological capabilities and skills that make tracking and attributing weapons-grade materials more difficult. These efforts contribute to international security.
Fact: Other countries threaten the United States and allies with nuclear attacks. They have or are developing nuclear warheads and delivery systems to be able to execute such attacks and add credibility to their threats.
Fact: There is no empirical evidence that U.S. nuclear weapons reductions have dissuaded other countries from developing their own nuclear weapons capabilities.
Fact: Because nuclear weapons will continue to be salient for decades to come, the United States must develop means to defend itself and allies from their devastating effects.
A Pew poll from 2018 found that terrorism was the number one priority for Americans—above the economy, education, and health care.1 A separate Pew poll from a year earlier found that approximately three-quarters of Americans were concerned by the threat of Islamist extremism specifically.2
This is an understandable fear. The most devastating terrorist attack in American history occurred on 9/11, resulting in the U.S. taking the fight to al-Qaeda in Afghanistan, Pakistan, Iraq, Syria, Yemen, and Somalia. Many of al-Qaeda’s top leaders were killed, with Osama bin Laden tracked down in Pakistan in May 2011. Others were captured and detained at Guantanamo Bay, where 9/11 mastermind Khalid Sheikh Mohammed remains today. The U.S. also pinned al-Qaeda back with its ongoing campaign of drone strikes.
Despite these welcome developments, the threat endures. The rise of an al-Qaeda offshoot, the Islamic State of Iraq and al-Sham (ISIS), led to a reign of terror that saw countless innocents, including Americans, killed by Islamists across the Middle East, Africa, Asia, and Europe. While the U.S.-led Global Coalition to Defeat ISIS succeeded in destroying the Islamic ‘Caliphate’ that ISIS created in Iraq and Syria, the war is far from over. ISIS, which pulled in tens of thousands of foreign fighters, is reverting to its insurgency roots, while al-Qaeda remains a resolute adversary. The U.S. military remains active in Syria and Afghanistan, among other countries, in either a combat or a training role, in an effort to head off the risk this poses.
The threat overseas has been accompanied by an ongoing risk to American lives domestically: There have been well over 100 Islamist terror plots directed at the U.S. since 9/11. While the vast majority have been thwarted by the diligent work of U.S. law enforcement and intelligence communities, attacks in Boston, San Bernardino, Orlando, and New York in recent years are a reminder of the ongoing risk to American lives.
Troublingly, many of the plots that the U.S. has faced were not dreamed up by foreign terrorists, but were the work of those radicalized right here in the U.S. One of the most influential Islamist ideologues in the post-9/11 era was an American citizen—Anwar al-Awlaki, a charismatic al-Qaeda cleric responsible for a wave of plots against the West until his death in a September 2011 drone strike. Unfortunately, Awlaki’s online lectures continue to radicalize others.
ISIS, al-Qaeda, and their supporters are ultimately manifestations of a broader ideology: that of Islamism, an ideology that dictates that Islam is not just a religion, but an all-encompassing socio-political system in which sovereignty lies with god over man and Muslims are required to live in an expansionist Caliphate governed by sharia law.
ISIS and al-Qaeda insist that force is required to bring this about, whereas proselytizing Islamist groups like the Muslim Brotherhood believe it can be achieved by preaching, infiltration, and persuasion. While the tactics of violent Islamists may diverge from those of political Islamists, their vision for what the endgame looks like is the same. Complicating the problem, the U.S. is forced to engage Muslim Brotherhood–linked groups overseas because they are part of various governments.
Military victories on the battlefield must be backed up by victory in the battle of ideas against Islamism. The U.S. has excelled at the former. The latter has, so far, proved much trickier to achieve. As long as this remains the case, Islamist terrorism will continue to imperil the U.S. and its allies.
Finish the job against ISIS while encouraging regional allies to step up. The U.S. needs to crush ISIS while avoiding the temptation to nation-build in Syria. While a military presence is still required for counter-terrorism and intelligence gathering, the U.S. should push for regional Arab allies to assume greater responsibility for stabilizing eastern Syria with troops and economic support. While this coalition would require continued U.S. support, it would lighten the burden on the military while bolstering Arab allies.
Renew the U.S. commitment to preventing terrorist groups from controlling territory. The U.S. plays a vital role in containing the terrorist threat emerging from the Middle East, Asia, and Africa. When terrorist groups control territory, it allows them space from which to plan attacks: The 9/11 attacks were planned from Afghanistan, and more recent attacks in Europe were planned from Syria. The control of territory also provides a source of revenue for terrorists, primarily through the extortion of those living under their control. The U.S. must work with its partners around the world to prevent the emergence of territory governed by Islamist groups, cutting off funding for terrorist groups while capturing and killing their fighters.
Harden defenses for the next wave of foreign fighters. Syria drew in tens of thousands of foreign fighters from across the globe. With the Caliphate broken and those fighters dispersing, the U.S. must be dynamic if it wants to stay ahead of the next foreign fighter threat. That would involve monitoring the travel patterns of terrorists and cajoling allies and partners into hardening their own security measures, while working to bolster intelligence sharing about developing threats to the U.S. and its allies. It would also involve an assessment of domestic security procedures and vulnerabilities.
Allocate resources to contain future threats from newly released terrorists—at home and abroad. There are tens of thousands of ISIS suspects being held in Kurdish-run detainee camps in Syria, including terrorists with ties to America. The next Administration should determine which of these detainees have a legal right to enter the U.S., assess whether they have committed federal crimes, and consider prosecuting them. The U.S. also has dozens of terrorists convicted of terrorism-related offences set for release from prison.3 It is possible that these convicted terrorists have not renounced Islamist ideology and could attempt to carry out attacks upon release. The U.S. must ensure it can safely monitor these newly released convicts.
Roll back the Muslim Brotherhood. A strategy is needed for political Islamists such as the Muslim Brotherhood. This strategy may involve designation of the Muslim Brotherhood as a terrorist organization if there is credible evidence of the Brotherhood committing acts of terrorism. However, with the Brotherhood tending to eschew overt acts of violence, the U.S. must also be prepared to try and weaken the movement’s ideology. This strategy would take as read that the Brotherhood are adversaries—not allies—and that their worldview does not represent the majority of American Muslim opinion. Putting an end to the policy of U.S. government engagement with Muslim Brotherhood legacy groups in the U.S. should also be part of the strategy.
Fact: Islamist terrorism is an ongoing threat to the homeland and to Americans overseas.
Fact: ISIS had success persuading a small number of American Muslims to travel to their ‘Caliphate.’
Fact: Al-Qaeda and ISIS have terrorist affiliates around the world.
Fact: The Muslim Brotherhood has a decades-old presence in the U.S.
U.S. nuclear weapons have kept peace by deterring a large-scale attack against the United States and allies since the dawn of the nuclear age. They are the most powerful weapons the United States currently has at its disposal. Nuclear weapons deter because adversaries considering attacking the United States or its allies are faced with the prospect of instant annihilation. Additionally, more than 30 countries around the world depend on U.S. nuclear security guarantees in exchange for foregoing developing their own nuclear weapons, or, in the case of France and the United Kingdom, keeping their nuclear arsenals smaller than they otherwise would have been. Because of their critical role in continuing U.S. well-being, the government must ensure that U.S. nuclear weapons remain safe, secure, and militarily effective.
At the same time, U.S. nuclear weapons are old. The nuclear triad (bombers, intercontinental-range ballistic missiles, and submarine-launched ballistic missiles) is overdue for modernization. Nuclear warheads were last tested in 1992 and, unlike its competitors and adversaries, the United States currently is unable to produce new nuclear warheads except for an extremely limited number in laboratory conditions. Modernizing U.S. nuclear weapons and the infrastructure that supports them has been a number one priority for U.S. defense policy since at least 2010 due to the important role that nuclear weapons play in our security and the security of our allies.
Providing for the common defense is one of the primary responsibilities of the federal government. Perhaps nowhere is the gap between this duty and actual U.S. conduct as apparent as when it comes to U.S. missile defense programs. Despite adversaries building up their missile arsenals, the United States only deploys a limited number of missile defense interceptors capable of defending the U.S. homeland from small-scale ballistic missile threats, such as those that North Korea or potentially Iran can generate. This means our homeland is vulnerable to Russian and Chinese ballistic missiles.
U.S. vulnerability to a missile attack is an issue because of the lethal payloads that missiles can deliver and the short time frames involved. An intercontinental-range ballistic missile can reach the United States in about 30 minutes. One such threat is an electromagnetic pulse (EMP). An EMP would disable all electronics within its line of sight, potentially sending the United States back to a pre-industrial era. Americans deserve better than perpetuating these vulnerabilities.
Modernize the U.S. nuclear deterrent. U.S. nuclear bombers, submarines, and intercontinental-range ballistic missiles are in dire need of modernization. Since the end of the Cold War, the United States largely stopped paying attention to nuclear deterrence matters because expectations were that the international environment would become more secure. These hopes have dimmed as the United States has found itself facing new nuclear-armed adversaries, such as North Korea, and a return of great power competition, with Russia and China. Congress has supported the Obama Administration’s nuclear weapons modernization program on a bipartisan basis. This modernization program has been continued under the Trump Administration with small adjustments: the development of a low-yield warhead for the submarine-launched ballistic missile in the near term, and a sea-launched cruise missile in the midterm to address what Russia could perceive as a gap in U.S. nuclear weapon capabilities. The Russian leaders appear to think that the use of a nuclear weapon would make the United States back down first in a conflict because they do not believe that the United States would use its high-yield nuclear weapons in response. That misconception is dangerous. The United States must ensure its system of nuclear deterrence is safe, secure, reliable, and effective for decades to come.
Develop and deploy a comprehensive, layered missile defense system. Ballistic missiles launched by an adversary could reach anywhere in the United States in about half an hour—even less, if they are launched from shorter range. They can deliver devastating payloads, including an EMP if a nuclear warhead on the top of a missile were detonated at high altitude. The spread of ballistic missiles into the hands of dangerous actors such as North Korea increases the imperative to develop a comprehensive, layered missile defense system. Such a system would include interceptors in space and boost phase missile defense capabilities. Missiles are the slowest and the most vulnerable to an intercept in their initial phases of flight; but it is also the most technologically challenging phase for intercepts because it is the shortest. Congress should support development and deployment of missile defense capabilities.
Increase awareness of the Electromagnetic Pulse (EMP) issue. Americans depend on a stable and reliable supply of electricity for every aspect of life. That makes the nation uniquely vulnerable to an EMP, a perfect asymmetric choice of a weapon for less technologically advanced adversaries such as North Korea. The Administration and Congress should work jointly to address this vulnerability, including increasing awareness of the importance of emergency preparedness among Americans and increasing the resilience of the domestic electric grid.
Increase nuclear weapon test readiness. Washington should realize that nuclear test readiness is a critical component of deterrence. U.S. nuclear warheads are old, and the nation might find itself needing to conduct yield-producing experiments on its nuclear warheads in the future, whether because of an issue with the current warhead stockpile that requires a significant fix, or due to developments in adversaries’ nuclear capabilities that require a new weapon design. Congress and the Administration should support steps that give the United States more flexibility should it find itself surprised by any of these developments.
Advance new nuclear weapons designs. The United States currently conducts only very limited activities to train future generations of weapon scientists and engineers in skills that would allow it to develop and deploy new nuclear warhead designs. Currently deployed U.S. nuclear warheads are based on 1970s and 1980s designs and prioritize yield-to-weight ratios over, for example, security features. The National Nuclear Security Administration (NNSA), the government agency responsible for nuclear stockpile stewardship sustainment, should ensure that the next generation of scientists not only has access to knowledge that their predecessors developed, but also that it gets to exercise the skills necessary for the design, development, and deployment of a new warhead.
Develop and deploy a capable space-based sensor layer. The federal government has options to make existing ballistic missile interceptors more efficient. These options ought to be pursued with urgency on a bipartisan basis. One such option is to develop and deploy a space-based sensor layer to augment data that missile defense systems need to successfully cue an interceptor toward an incoming missile. Another is to deploy more Multiple Object Kill Vehicles on each interceptor of suitable types to make them more effective.
Modernize the U.S. NNSA complex. The NNSA, particularly the laboratories, is tasked with the critical mission of supporting U.S. nuclear warheads throughout their life cycle. However, the laboratories have been focusing on missions other than warhead research and development. Together with decades of underfunding since the end of the Cold War, the laboratories have lost critical nuclear weapon design and manufacturing skills. Congress should support the NNSA’s efforts to address these issues. Continued deterrence of large attacks on the United States and allies depends on it.
Fact: U.S. nuclear weapons have been the most successful weapons system to date, deterring large-scale attacks against the U.S. homeland and allies without fail every day since the dawn of the nuclear age. Having modernized, flexible, and agile nuclear weapons and infrastructure supporting them is the best guarantee of U.S. and allied security for the foreseeable future.
Fact: More adversaries and potential adversaries are investing in missile technologies, threatening the safety of what the U.S. values.
Fact: An electromagnetic pulse could send the United States back into the pre-industrial era, at great loss of life and economic prosperity.
The African continent is rapidly growing in strategic importance. Its ongoing demographic boom is producing an immense working-age population and potential consumer class. Richly endowed with natural resources, including arable land, important mineral commodities, and abundant fishing stocks, a number of its economies are among the fastest growing in the world. It has a commanding position on maritime chokepoints and abuts two continents, and its countries comprise the world’s largest voting bloc in the United Nations, giving them significant diplomatic influence. Many countries, including American competitors such as China and Russia, are rapidly building influence with African countries. Al-Qaeda and ISIS-aligned terrorist organizations have proliferated on the continent in the last decade, and many are currently strengthening.
Since the end of the Cold War, U.S. policy toward Africa has focused on delivering overseas development assistance and ameliorating the security problems emanating from the continent. This approach is outdated. It does not account for the continent’s many economic opportunities for American companies, or the significant influence America’s geopolitical competitors have built on the continent. Chinese activity especially may threaten American strategic access to Africa, is increasingly creating anticompetitive economic norms on the continent that disadvantage U.S. companies, and is modeling illiberal governance that harms American efforts to promote democracy on the continent.
Under the Trump Administration, U.S. policy is adjusting to account for the realities of today’s Africa. Its under-construction Prosper Africa initiative intends to advance the critical task of facilitating more American private sector activity. The Administration continues important pre-existing initiatives such as PEPFAR and the Millennium Challenge Corporation as well. While rightly recognizing the paramount challenge of nation-state competitors, the Administration is also continuing important counterterrorism activities on the continent.
The U.S. still lacks a strategic messaging campaign for the continent, however—a matter of increasing urgency since a significant part of the competition with China is one of ideology. In addition, the Administration has not had enough engagement with African leaders at the most senior level. Finally, while Prosper Africa has the right focus, its implementation has been too slow thus far.
The U.S. government’s engagement with Africa must protect its core strategic interests in the continent, namely retaining sufficient influence and positioning on the continent to protect American interests there, facilitating regulatory and normative environments that ensure U.S. companies can compete on an even footing in Africa, encouraging the growth of African democracy, and ensuring that terrorists cannot use the continent as a staging ground for attacks against the U.S.
Focus on governments with which the U.S. can reasonably expect to have a mutually beneficial relationship. Countries that are good candidates for a strategic partnership should receive the full suite of U.S. engagements, such as consideration for a free-trade agreement; fully staffed U.S. embassies, including a commercial attaché; U.S. government–facilitated visits by U.S. business delegations; high-level U.S. official visits and interventions on behalf of U.S. companies; and mobilization of that country’s U.S. diaspora to invest and engage in other constructive ways.
Encourage and assist U.S. private sector activity in Africa. Prosperous American companies strengthen U.S. economic might and contribute to American soft power. More U.S. business involvement in Africa would also help resist the further institutionalization of anti-competitive economic norms on the continent that benefit competitors such as China.
Help African governments achieve greater economic freedom. Doing so would bring greater and more rapid prosperity to their people, and expand investment opportunities for American companies. The U.S. could provide the rationale for and help with the technical expertise to liberalize regulatory environments, privatize state-owned industries, and improve the rule of law.
Foster good governance. The U.S.’s most valuable allies are usually those that share its core values such as democracy, rule of law, and respect for the free market. Good governance also promotes human flourishing and ameliorates instability and terrorism. The U.S. should assist African civil society organizations that hold their governments accountable, focus on helping the fight against corruption, and deepen coordination and cooperation with allies working on the same issues.
Launch a strategic messaging campaign in Africa. All government agencies that engage on Africa should have a unified message that explains the benefits of partnering with the U.S.; touts the value of democracy, individual liberty, and the free market; and highlights the decades of positive U.S. engagement in Africa. The campaign should include messaging about China in Africa that is culturally appropriate, respectful of African states’ sovereign prerogatives, and realistic about some African countries’ need for Chinese engagement.
Increase senior U.S. officials’ engagement with African counterparts. Meetings in the Oval Office with the President are low-cost investments in a relationship that can have an outsized impact. Cabinet members and congressional delegations visiting the continent can also enhance ties with important African countries.
Make the U.S.–Africa Leaders Summit a biannual event. Many countries, including some U.S. competitors, hold regular summits with African heads of state. The U.S. has only ever held one, in 2014. A summit is a very public way to demonstrate commitment to the U.S.–Africa relationship, facilitate linkages between U.S. companies and African governments, and remind African governments of the desirability of partnering with the U.S.
Fact: Africa’s physical location, natural resources, soaring population growth, and growing economies make it increasingly important to American interests.
Fact: Other countries, including U.S. competitors, are rapidly increasing their engagements in Africa.
Fact: Islamist terrorism is a potent and growing threat in parts of Africa.
Fact: Poor governance is a critical impediment to development and security in Africa.