The National Security Agency (NSA) has been in the news ever since Edward Snowden exposed government documents showing that the NSA has been spying on virtually all Americans and collecting massive amounts of data.

Some Americans don’t think it is that big of a deal.  They figure that as long as they are not doing anything illegal, then they have nothing to worry about.  To a certain extent, they are probably right.  As long as you are not a major target, then your electronic communications and telephone conversations will likely never be seen.  There aren’t enough people at the NSA to look through billions of pieces of data coming through every day.

With that said, this is a critical issue in regards to liberty, and really the future of our society.  If the NSA is allowed blanket spying on everyone, then the people at the NSA are in charge.  They are practically running their own dictatorship.  The people there are more powerful than the president, the chair of the Federal Reserve, or any of the members of Congress.

You might say that Congress can always revoke funding or tighten restrictions on the NSA.  While technically true, is this really realistic?  If the NSA has been collecting data on all members of Congress, only those with truly nothing to hide would dare oppose the NSA.  The NSA can bribe almost anyone that it chooses.

How many congressmen live a clean enough life that they would be willing to oppose the NSA and risk having everything exposed to the public?  It doesn’t even have to be as bad as doing something illegal.  It doesn’t even have to be cheating on a spouse or getting drunk at a party.  It could be anything.  It could just be conversations about other individuals that you wouldn’t want others to hear.  It could be a medical condition that you would prefer not to be known.

How many people are there in this world that would be willing to make public knowledge everything he or she has said and done in their life?  Almost everyone wants some kind of privacy and everyone has their embarrassing moments.

The NSA is a giant monster right now that needs to be destroyed.  Edward Snowden tried to do a favor to the American people by telling them about criminality inside the government.  Yet some are actually blaming Snowden for being a traitor.

Yes, he was a traitor to the U.S. government that was engaging in criminal behavior.  To the American people, he was trying to be a patriot and a hero.

The only way to stop the NSA now is to shut it down.  You can’t tinker around the edges, as Obama’s speech indicated, and expect anything significant to change.  It seems that the NSA is essentially running the country now and the only possible way to stop it is by massive opposition by the general population.

There needs to be so much pressure put on Congress and Obama that they fear the public opposition more than they fear the NSA and the secrets they hold.  There is no other way.

Americans have been told what their own government is doing.  This is not about terrorism vs. security.  This is about liberty vs. tyranny.  Terrorists are not a threat to liberty unless the people are tricked into believing that terrorism is the biggest threat.

The biggest threat to the American people is their own government, just as we have seen so many times in history.

Just because you supposedly have nothing to hide, it doesn’t mean that you have nothing to fear.  The government has a monopoly on the use of force, yet many people will worry more about a company obtaining their private information than the government.

A private company can only harm you by doing something criminal or by handing over your data to the government

If you are going to be fearful of something, it should be the entity that can use force against you and get away with it.

While the U.S. has been in a period of slow growth lately, there is no question that Americans are the wealthiest people in the world, at least when considering major countries.  It is possible that a few small countries such as Switzerland and Hong Kong may have more wealth per capita.

There is a lot of misunderstanding about the reasons for this wealth and it spreads across the political spectrum.

The left simply does not understand capitalism and therefore cannot understand the reasoning for great wealth.  Some, like Obama, attribute it to government.  But this doesn’t make much sense, because there is government activity in virtually every country in the world.  The only way this reasoning is possible is to say that the U.S. government is somehow more efficient, wiser, and more benevolent than all of the others.

Many on the left will say that Americans are rich at the expense of the rest of the world.  They will say that Americans consume the greatest percentage of the world’s resources.  Actually, it is true that Americans are the biggest consumers, but they are consuming things that have either been produced by Americans or have been obtained through trade.

This is really where the left fails to understand capitalism.  They think the only way someone (or some country) can get rich is at the expense of others.  They do not understand the basic concept that we don’t live in a world of limited wealth.

They do not understand that wealth can be increased through increased production.  They think that there is a wealth pie that should be divided up equally (unless they are talking about themselves).  They think the pie can’t grow.  They think there is limited pie to go around.  They don’t understand the pie will grow under capitalism.

Now, there are also those on the left who think that America is wealthy because of the American empire.  They think America is rich from occupying other countries and stealing from them.

These people aren’t completely off base, but they are mixing cause and effect.  The only reason that the U.S. government can have such an interventionist foreign policy is because it has a lot of resources to draw from.  This is because of American wealth.  But it would be a huge mistake to think that wars and occupations are any kind of a financial benefit to Americans.  It may be a benefit to certain sectors that make military equipment, but as a whole, it is a net loss for Americans when the government tries to run the world.  Does anyone really think that the wars in Iraq and Afghanistan have been any kind of a financial benefit to the American public?

On the other side of the coin, some conservatives, and even some libertarians, mistakenly think that America is wealthy because of the great freedom that we have today.

While there is certainly still some semblance of a free market in the U.S., it is far away from what it once was.  Overall, the gap has narrowed, if not closed completely, between the U.S. and many other major countries.  Is there really much difference between the U.S. and Canada, New Zealand, and Australia?

In fact, in terms of economic liberty, countries like Hong Kong and Singapore are far freer than the U.S.

I think some people forget to remember the history of the U.S.  The 19^th and 20^thcenturies saw phenomenal growth.  People living in the year 2000 would have had almost nothing in common with people living in 1800.  The difference in living standards is amazing.  People living in 1800 would have had far more in common with those living 2,000 years before them.

So, during the last two centuries, Americans created an amazing amount of wealth.  It is incredible what compounding growth does over time.  And while the U.S. is no longer as free as it once was, Americans have been able to keep most of their wealth and even continue to grow it, even if at a much slower pace.

In conclusion, capitalism should get credit for Americans being relatively wealthy.  But it isn’t so much the capitalism of today, as there is a lot less economic freedom than there once was.  Instead, we should credit over two centuries of capitalism, along with an entrepreneurial spirit that still remains today, even if to a lesser extent.

The Trans-Pacific Partnership, also known as TPP, is a trade agreement that originally included just four countries – Chile, Brunei, New Zealand, and Singapore.

Since that time, there have been negotiations for expanding the membership among 8 different countries, plus a couple of others showing interest in joining.  The negotiating countries include the U.S., Canada, Mexico, Australia, Peru, Vietnam, Malaysia, and Japan.

The TPP has similarities to other trade agreements that the U.S. has been involved in, such as NAFTA.  Unfortunately, some people are misled to believe that these agreements are pro-liberty and pro free trade.  It is interesting that the biggest opponents of these agreements often come from libertarians and the far left.

Just like most government laws and most international agreements, there are some parts worse than others.  There may even be some positive aspects about it.  Unfortunately, any positives that the TPP may offer are more than offset by the negatives.

The first clue is that the negotiations and proposals regarding the TPP have been largely secretive.  What is it that these politicians don’t want the public finding out about?

There is a false impression that the TPP and other trade agreements promote free trade.  But it is really just managed trade.  It is possible that some aspects might improve trade conditions if a country already has strict regulations and high tariffs.

But we can be reasonably certain this isn’t a free trade agreement, just the same as others like NAFTA.  Why do you even need an agreement for free trade?

The only reason that free trade wouldn’t exist is because government is preventing it.  So if the government wants free trade, it just has to stay out of the way.

You don’t need for a government to pass a law saying that the tax rate will be 0%.  It can simply repeal the taxes already in existence.  So you also don’t need a government enacting an agreement for free trade.  It simply just has to get rid of its regulations and tariffs, and free trade will be in existence.

There are other aspects of the TPP that may be worrisome.  There are provisions relating to intellectual property rights.   Ironically, some of these provisions are only known because of Wikileaks.

This is a subject that has much disagreement amongst libertarians and conservatives.  Ironically, it has been some leftist U.S. politicians who have come out the strongest against the TPP and its provisions on intellectual property.

While the subject of intellectual property is a subject for another day, it looks as though some of the worst aspects of U.S. law would be inserted into the TPP, such as strict patenting laws for medicines.

Do you really think the U.S. government is trying to help the general public, along with the people in foreign countries?  Or is it more likely that the U.S. government is trying to help big pharmaceutical companies (as one example), which have full-time lobbyists in Washington DC?

In conclusion, while it is possible there may be a few positive aspects of TPP, it will be mostly negative.  This doesn’t represent free trade and it is not a liberty friendly agreement.  It is a partnership between politicians.  If it were such a great thing for the general public, then they wouldn’t be so secretive about it all

The good news is that there is opposition from both sides of the political aisle.  Some people may not be opposing it for all of the right reasons, but it is still opposition.

I am having difficulty figuring out the hype over water conservation.  It is pushed by the establishment media.  It is taught to kids in school.  Or perhaps brainwashed into their minds is a better description.  In some places, you can only water your lawn on certain days of the week.

First, nobody needs to tell me how to use my water or give me an incentive to supposedly save water.  I pay my water bill each month.  That is my incentive.  I am not going to unnecessarily water my lawn because I don’t want to pay a huge water bill.  I am only watering my lawn so that my grass doesn’t die.

My next thought on this subject is on the whole idea of saving water.  Where are we saving it?  Water evaporates into the air and falls back down in the form of rain.  It actually works really well as a filtering system.  You get clean water falling from the sky.

I am no scientist, but I don’t think massive amounts of water are disappearing from the earth.  It may get redistributed from some areas to others, but there is no shortage of water on earth.

This leads to my next thought and that is that two-thirds of the earth is covered by water.  Again, why is anyone supposedly worried about a shortage?  I understand that you can’t drink salt water, but even with that there is wonderful technology that can actually remove the salt to make the water usable.  It may not be cheap to do, but there is no shortage.

At some price, water is available.  While it does fall from the sky, it is not a free resource, unless you can collect your own rainwater or if you have a well.  But at some price, there is plenty of water to go around.

This leads to the most important point of all regarding water conservation.  In most places, it is government that is in charge of supplying water.  If there are any shortages, that is clearly the reason.  If water were like other goods provided in the marketplace, there would be a valid price system that would allocate resources and find equilibrium for supply and demand.

This means that some places would pay more for water.  If you live in a remote area or if you live in a dry climate, you can likely expect to pay more for water.  But the higher price will mean that people in those areas will conserve more because of the incentive to spend less money.  In addition, the higher price will provide a signal to suppliers to shift more resources – in this case water – to the areas that need it most.

It is quite symbolic of government that water conservation is pushed.  When the government gets involved in something, there is usually rationing.  Think about medical care.

Meanwhile, in the voluntary market sector, we see the opposite.  Do you ever see bottled water companies telling you to limit your purchases to save water?  That would be ridiculous.  Bottled water companies want you to buy their water.  If they have a low supply of water for some reason, they can simply raise their prices.

Whenever you see shortages and rationing, think government.  It is no different with water.  It is no different with medical care.

The 2014 Index of Economic Freedom has been released by the Heritage Foundation.  Notably, the United States has fallen outside of the top 10 of the most economically free countries, coming in at number 12.

The top spot is held by Hong Kong, which has held that spot for 20 consecutive years.  The top ten countries are as follows:

I think the rankings are somewhat subjective, although many of the measurements are objective.  It is hard to say if the criteria used capture all of the important factors of a free market economy and also if the weighting of each measure is appropriate.

But overall, I think the index is a decent benchmark of figuring out the degree of free markets and property rights in different countries.

While the U.S. is now out of the top 10, it is important to realize that it is still by far the richest country in the world.  But if you measure on a per capita basis, then the U.S. is not the richest.  For example, Singapore has a much higher GDP per capita.

Although government in general has grown beyond belief in the U.S., there is still a lot of wealth from what was accumulated in the past.  And while taxes and regulations are burdensome, there is still a strong rule of law, even if the law isn’t always good.  There is also a strong tradition of property rights and a general appreciation for entrepreneurship and free trade.  For these reasons, it is still an attractive place for investors.

I appreciate the Index of Economic Freedom because it is an easy way to show that free markets work and socialist and centrally planned economies don’t work.

It is always hard to show evidence of capitalism working within a country, or the opposite, in showing that central planning is destructive.  In the U.S. there are so many variables with monetary policy, taxation, government spending, regulation, etc.  They are often all moving in different directions.  When something goes wrong in the economy (or something goes right), it is hard to pin the blame or credit on any one particular thing.

With the Index of Economic Freedom, it is clear cut that the countries that are more economically free are generally much better off.  The people have a much higher standard of living and there is far less poverty.

If you look at the places that are ranked worse than 100 on the index, you can quickly realize that these are absolutely miserable places to live, at least for the most part.  They are countries with little in the way of strong property rights and they all have the characteristic of having oppressive governments.

It is not that all governments do not try to be oppressive, but it is obvious that the economically free countries have governments that are generally the least oppressive and kept somewhat in check.

The next time one of your friends is pushing for more government central planning, point out this index and ask your friend where he would rather live.  The countries in the “free” and “mostly free” categories are generally going to be the most attractive places to most people with any sense.

It can sometimes be frustrating to have an economic discussion with people who have little interest in economics.  Well, I say they have little interest in economics, but they are quick to prescribe their own solutions to poverty and human suffering.  They are quick to give their own suggestions on how to centrally plan an economy.

I’ll give an easy example.  Someone will complain about the high unemployment and the need for the government to help those who can’t find a job.  In steps a free market economist who suggests that we repeal minimum wage laws.  The economist provides an explanation about how when the government does not allow prices to reflect supply and demand – in this case the price of labor – it disrupts the market clearing process.  In this case, keeping wages artificially high will lead to an oversupply of labor (unemployment).

The central planner will respond that he is not interested in graphs and discussions of supply and demand.  “We are living in the real world and there are real people who are suffering at this very moment.  We can’t be concerned with economics.  We have to be concerned about the human suffering.”

Talking about economics with someone who has no interest in economics can be like talking to a rock.  Actually, talking to a rock would be less frustrating, because at least the rock can’t respond with something ignorant.

I understand that most people do not find economics interesting and that is fine to a degree.  But if they have no interest, then they should stop pretending how best to use the government to bring about a more equal and so-called compassionate society.  They should stop supporting politicians who have these grand ideas of using government to centrally plan and supposedly improve people’s lives.

Economics is dealing with the real world.  When a free market economist points out that minimum wage laws tend to cause higher unemployment, it doesn’t mean that fake people are unemployed.  It is real.  Real people are needlessly suffering because of those who want to impose their ways on others.

Minimum wage laws prevent two consenting parties from agreeing to a contract.  It makes certain jobs for certain people illegal.  It says that someone who can get a job for $6 per hour is not allowed, even if there are no jobs available at the minimum wage.  It is real people who face this.

I think there are a couple of ways to address this problem.  First, do not cede the moral high ground.  Taking a position of liberty and free markets is the moral position.  You are advocating a voluntary society without the use of force or the threat of force.

In the case of minimum wage laws, you are not willing to use the force of government to prevent a voluntary contract between consenting individuals.

A second important point is that you should insist that you are taking the most compassionate position.  It is a free market economy that will produce far less poverty and human suffering.

In the case of minimum wage laws, eliminating them is the compassionate thing to do.  This will allow people to work who want to work.  It will allow young people and unskilled people to get a job and work towards something better.  It will allow them to get experience and better themselves.

In conclusion, some people will never be convinced, no matter how much reason and common sense you throw at them.  But there are some people who are open-minded who may understand that a position of less government and more liberty is actually the moral position and the compassionate position.

We should not be intimidated by those who claim that we are not compassionate.  It is the policies of the central planners that have led to so much misery and unnecessary suffering.

Unsurprisingly, there is already talk of Hillary Clinton running for president in 2016.  She has been planning to get back to the White House since before she left there.  Her time as senator in New York was a stepping stone to the presidency.  When Barack Obama derailed her plans in 2008, she took the job of Secretary of State so that she wouldn’t burn her bridges.

2016 could end up being a very interesting presidential election year.  Personally, I think the presidency is overrated in regards to who wins.  The rhetoric differs between candidates, but the policies are continuous.  Republicans and Democrats don’t like to hear this, but there is not much difference between Obama and his predecessor Bush.

And if you look at the 2012 election, it was a contest of Obamacare and Romneycare.  Romney didn’t want to admit it, but Obamacare was essentially modeled after Romney’s plan in Massachusetts.

I think 2016 does matter though, if only as a reflection of public opinion.  Ironically, Hillary’s biggest threat right now is Obamacare.  This healthcare debacle has become quite unpopular, especially as people get kicked off their insurance plans and they see the huge premiums for new plans.  It is tied to the Democrats and Hillary is a Democrat.

I almost wonder if Hillary will start to distance herself from Obamacare.  Her job in Obama’s cabinet was related to foreign policy and had little or nothing to do with medical care.  I am just not sure if Hillary will push for her fully socialized healthcare agenda or if she will just try to change the subject.

I can envision Hillary getting into the White House, even though she is disliked by many.  Some people are enthusiastic about Hillary, but about half the country doesn’t like her.  It might be more accurate to say that half the country dislikes or hates Hillary.

But I can still see a path to the White House for her, similar to her husband.  Many people forget that Bill Clinton never won a majority of the popular vote.  Of those who actually voted, he only received 43% of the vote in 1992 and 49% of the vote in 1996.  Remember Ross Perot?

I would not be surprised to see Jesse Ventura run for president in 2016 as an independent candidate.  And don’t discount his chances.  He is very anti-establishment at a time when people are not fond of the government.  Ventura is mostly anti-war and pro civil liberties.  As a libertarian, I think he is lacking in economic understanding, but I do give him credit for having some principles, having honesty, and having a backbone.

I can also envision Rand Paul getting the Republican nomination.  He is far more political than his father and he will play ball with the establishment Republicans.  (I am not saying this as a good thing.)

If there is an election in 2016 between Hillary Clinton, Rand Paul, and Jesse Ventura, I can see Hillary getting in with 40% of the popular vote, or maybe even a little less.  If Ventura and Paul both get around 30%, then Hillary gets in.

This would make sense, as many independents and left-leaning libertarians (if that isn’t a contradictory label) would likely support Ventura.  Many right-leaning libertarians (again, if it isn’t a contradictory label) and most Republicans would support Paul.  Most Democrats and a few independents would support Hillary.

Even if the Republicans nominated someone else, I could still envision something similar to happen.  There are a lot of possible candidates, although Chris Christie looks far less likely now.

I don’t necessarily think this country is doomed if Hillary gets in as president.  She is extremely corrupt and power-hungry, but even tyrants are limited in their abilities by public opinion.

It will be interesting to see if Jesse Ventura runs.  In my opinion, I think it would be a good thing, even if he didn’t win.  I think he would attempt to expose a lot of government secrets and lies.  He would bring up issues that we otherwise wouldn’t hear about and he would challenge his opponents.

2016 may be a really interesting year for politics.  It may be even more interesting if the economy is falling off a cliff at that point.  If anything, the results will likely give us an indication if there has been a shift in public opinion towards more liberty and less government.

Since 2008, the Federal Reserve has more than quadrupled the adjusted monetary base.  But this new money has not resulted in massive consumer price inflation.  There has certainly been significant asset price inflation, particularly in stocks, but overall prices have not exploded in correlation with the monetary base.

I see two main reasons that prices have stayed relatively tame.  The first reason is that the velocity of money has been low.  Another way of saying this is that the demand for money has been high.  Money is changing hands less frequently, thus keeping prices from being bid up.

The second main reason for tame price inflation is bank reserves.  The majority of the new money created by the Fed has gone into excess reserves in the commercial banks.  So instead of loaning out these new deposits, banks have been keeping them as excess reserves with the Fed and earning a small .25% interest rate on the money.

I recently received the following comments and questions regarding bank reserves:

“If one accepts the premise that most of the so-called stimulus money is simply sitting as excess reserves propping up the so-called ‘too big to fail’ banks, what’s the harm if it stays there?  If that money doesn’t get velocity, we won’t see massive, commensurate price inflation.”

These are good questions.  If the newly created money by the Fed simply goes into excess reserves, does it matter?

The answer is “yes”; it still matters.  While I think we are better off with the high excess reserves as opposed to all of the new money being loaned out, we would be much better off if the new money had not been created in the first place.

I think one mistake I have seen is people assuming that there is no inflation if the new money goes into excess reserves.  The fact that the new money is not being loaned out simply means that the money is not multiplying.  However, it is still new money.

That money sitting as excess reserves is money that has been deposited in the banks and is available for people and businesses to spend.  Perhaps you don’t feel like your checking account has gotten bigger over the last five years, but someone’s checking account has gotten bigger.  All of the money sitting as excess reserves is not owned by the banks.  It is money that represents real deposits.

So while having the new money go into excess reserves is far less inflationary than if it had been lent out, it is still inflationary, even if to a much lesser extent.

The other factor to consider is that, even though new money has gone into excess reserves at banks, it is still misallocating resources.  This is what inflation does.  It misdirects resources, including savings.  The low interest rates themselves send false signals to the market indicating that people should save less.

The Fed is having a free lunch right now because it is creating monetary inflation and not getting blamed too much for the bad consequences.  If we saw really high consumer price inflation, then the Fed would likely take a lot of blame.  But if resources are being misallocated and unemployment is staying higher because of the Fed’s actions, most people do not perceive this.  Therefore, the Fed is doing great damage and getting away with it to a large degree.

As of right now, we are better off if the excess reserves stay high.  Otherwise, we would likely see massive price inflation.  But we should not think that the Fed’s massive monetary inflation is not inflicting great damage just because much of the new money is going into bank reserves.  It is still making us poorer, even if more subtly.

There is a debate going on in Washington DC about extending unemployment benefits.  I don’t really like the word “benefits”, but I suppose it is appropriate in the sense that some are benefiting at the expense of others.

In a speech, Obama said, “I can’t name a time where I met an American who would rather have an unemployment check than the pride of having a job.”

This is a ridiculous statement.  I’m sure the people that Obama meets are not going to admit to him in a short conversation that they sure are happy they have unemployment benefits so that they don’t have to get a job.

The reality is that paying people to be unemployed does encourage unemployment.  How can it be otherwise?  Meanwhile, Obama is saying that we will lose jobs if the unemployment benefits aren’t extended.  Let’s just say that economics is not one of Obama’s strong areas.

Even if someone collecting unemployment could find a job that pays more than the unemployment, it may not be worth it to him to take the job, especially if the difference is not that great.  I have personally met people who admit they don’t want a job or a higher paying job because it would mean drastic cuts to their welfare.

I’m sure there are also many people collecting unemployment who are officially unemployed yet working in an unofficial job.  There are plenty of black market jobs where you can work and get paid under the table.

With all of that said, I don’t let the Republicans in Washington DC off the hook.  Those opposing an extension of unemployment benefits may or may not be doing it for the right reasons.  But we shouldn’t forget that it was under Bush when unemployment benefits were extended in the first place.

In addition, if we are going to cut welfare, I can think of a lot of places to start ahead of unemployment payments.  Restoring extended unemployment benefits for 2014 would cost less than $20 billion.  This is a large amount, but not large in comparison to an almost $4 trillion federal budget.

I agree in cutting welfare, but let’s start with some easy stuff.  Let’s stop funding the NSA to spy on us.  Let’s stop funding drones to go overseas and drop bombs on wedding parties.  Let’s stop funding the bank accounts of foreign dictators.  Let’s stop funding rich farmers through agricultural subsidies.  Let’s stop funding the big banks on Wall Street.  Let’s stop occupying virtually the entire world with the military.  Let’s stop funding the FDA that keeps potentially life-saving drugs off the market.

I could go on, but the point is that an argument over unemployment benefits is a drop in the bucket in terms of the budget.  It does affect real people.  Some people are scamming the system and some people probably really do depend on that money.

However, there are so many easier places to cut first.  Unfortunately, these are the things that have what is considered bipartisan agreement.  These are destructive things.

Aside from the money being redistributed, the only destructive thing about unemployment payments is that it encourages people not to work.  But at least it isn’t killing people and destroying things directly.

The governor of New York, Andrew Cuomo, is backing a proposal to provide tax relief in the state of New York to the tune of more than $2 billion.

When people these days are in a New York state of mind, it seems to be less about Billy Joel and more about having to pay exorbitant taxes just for the right to exist.

There are several things to take away from this news of Cuomo backing tax relief.  The first thing to realize is that even if this proposal passes, New York will still be one of the highest tax states in the U.S.  On top of that, New York City has a new mayor who wants to raise taxes even more on the so-called wealthy.

There are taxes at all different levels in New York and they are quite burdensome.

It is interesting that the governor is a hardcore Democrat.  He is the son of Mario Cuomo, a three-term governor of New York who was in office from 1983 until the end of 1994.

It is also interesting that some of the tax relief is actually business friendly and isn’t all slanted towards the poor.  While there is some typical Democratic stuff such as a tax credit for renters, there is also a lot to like.  There is a freeze on property taxes, a big increase in the exemption for estate taxes, and several changes that are helpful for businesses.

I think this just shows that there are some limits as to how much taxes can be collected at the state level, even if the limits are high.  It has gotten to a point where New York taxes and regulations are so bad that it is driving business away and it is driving some wealthy people and high-income earners away.  In the long run, Cuomo probably realizes that it will only hurt the government if too many tax victims leave for another state.

Unfortunately, the rules that apply to state governments do not apply the same way to Washington DC.  The federal government is borrowing a good chunk of what it spends.  It can do this because of the Federal Reserve and its ability to create money out of thin air.  The Fed simply buys the federal government’s debt to keep interest rates low and allow the game to go on.

Washington DC may be limited in how much it can raise taxes due to popular opinion, but it does not seem nearly as limited in how much it can spend.  Unfortunately, people don’t perceive that inflation is a hidden tax that hurts the middle class.

State governments do not have the ability to create money out of thin air, so they are essentially forced to maintain something close to a balanced budget.

With this news out of New York, I wouldn’t be jumping at the chance to live there.  It is still an extremely high-tax state and it is especially high-tax if you live in the city.

But it is still good news that a big-government guy like Cuomo still feels the need to support some tax relief.  I am not sure if this is due to losing too many tax victims or if it is because of public pressure.  Either way though, it is slightly encouraging.

There is a limit to government at some point, even in a place like New York where it seems that people are clamoring for big government.  At some point, markets have to be allowed to work.