The End Of Non-Insider Insider Trading Prosecutions?

This morning, on the first day of its new term, the Supreme Court denied cert in the case of U.S. v. Newman and Chiasson, otherwise known as the non-insider insider trading case.  Bloomberg News has the story here.   This is the case of two corporate non-insiders who acted on a "tip"  coming from an official company investor relations spokesperson, who would have given the same information to anyone who called, and where the tip passed through multiple layers before arriving at the defendants, where the defendants did not pay anything for the "tip" and the original guy who got the information from the spokesperson did not pay the spokesperson, and finally where the spokesperson himself was never prosecuted or charged with any wrongdoing.  On these facts, Newman and Chiasson were convicted and sentenced to 4 1/2 and 6 1/2 years respectively.  In December 2014 a unanimous Second Circuit reversed, held that what they were accused of was not a crime, and directed that there be no retrial.  I have previously covered the subject of these prosecutions multiple times, most recently on August 9 here, and going back to July 13, 2014 in an article titled "The Impending Demise Of The Insider Trading Jihad."

In the August 9 article I predicted that "the Supremes are not going to give this one the time of day."  Denying cert without opinion on the first day of the term for a petition that was only filed two months ago is the Supreme Court equivalent of "not giving it the time of day."

So where does that leave the insider trading jihad of Mr. Preet Bharara, and particularly the non-insider branch of the insider trading jihad?  The answer is, at least for the non-insider portion, it's dead.  If the Feds want to go on with this charade, their only avenue now would be to start a prosecution in some other jurisdiction (with a prosecutor other than Mr. Bharara), then try to get a court of appeals in that jurisdiction to take another approach from the Second Circuit, and then try to get the Supremes to take it on the ground that there is a "split" of the circuits.  This would be a multi-year process in the best of circumstances.  And most of the stock trading takes place in New York.

Up until today Mr. Bharara has tried to keep up the facade that he had 80+ good insider trading convictions, but now that game is over.  How many of those 80+ convictions are about to get thrown out?  Nobody has an exact count.  Bloomberg says "at least 10."  I think that's way low.  It could easily be twenty or even more.  That news will be dripping out over the next several months.

This was never more than a charade to begin with.  When the financial crisis hit in 2008 - 09, there was a cry for scalps from the likes of Elizabeth Warren and Barney Frank.  Their theory was that the stock market decline and the bank liquidity crisis could only be caused by greedy bankers and their dangerous trading practices.  None of those calling for scalps has ever articulated a coherent theory of how insider trading had anything at all to do with the 2007/08 market bubble or its bursting, nor even a theory of how insider trading (let alone its non-insider branch) causes any harm to other investors in the market.

But no matter.  Scalps were needed.  So the prosecutors cast around for something they could charge lots of rich traders with, and the best they ever came up with was insider trading -- which had literally nothing to do with the market bubble or its bursting no matter how you look at it.  But other than insider trading they never came up with anything that they could pin on individuals.  Of course, they came up with endless ideas to shake down the big banks, who will never take any case to trial.  See my tag on "Phony Prosecutions."  But at least a few people other than yours truly keep asking the embarrassing question, how can there be a crime here if no individual ever gets prosecuted?  (You mean it's just another shakedown of a bank?  Really?)

Recently the Justice Department says it is supposedly is taking a new tack and will start focusing on the individual wrongdoers in its prosecutions of financial wrongdoing.  I'll believe it when I see it.  Here's the problem, government:  When you prosecute a big bank, even if they did nothing wrong, you get a billion dollar settlement and a press conference and a front page article in the New York Times.  When you prosecute an individual, next thing you know, they take you to trial, and you may well lose, or have the conviction reversed and the whole prosecutorial theory declared to be not criminal to begin with.  Good luck!

Complete Self-Delusion In New Haven, Connecticut

I'm just back from New Haven, Connecticut, where my Yale class (1972) and the ones immediately before and after (1971 and 1973) held a "mini-reunion."  And I'm reminded once again that the political orthodoxy among these seeming best-and-brightest people makes the Manhattan orthodoxy seem mild by comparison.  To give you one indicator, looking around for political bumper stickers on cars, I spotted many of them, and every single one I saw was for the same candidate: Bernie Sanders.  Really.

To me the single most striking aspect of both the Manhattan and Yale versions of the orthodoxy is the smug self-satisfaction that "we" are helping "them" with massive socialist-model government programs and handouts, all while absolutely refusing to look around and observe the evidence of the destructive effects of these efforts.

The first session I attended after arriving was a presentation by a guy named Michael Morand, identified as Yale Deputy Chief Communications Officer.  The subject of the presentation was the renaissance in New Haven since we attended some 40+ years ago.  Or at least, it is a "renaissance" according to Morand. 

I will start by agreeing with Morand on one thing.  The area of New Haven immediately adjacent to the Yale campus, including the heart of downtown, is much improved since the early 70s.  There are new and renovated buildings in these areas, new and improved retail uses along Chapel Street and Broadway, and several new and better restaurants.  These things are visible to anyone who comes to visit the university, because they are right there in front of your eyes.  Morand could have pointed this out and left it at that, but that was not why he was here; he had bigger things in mind.

So instead of sticking to a plausible story of some gentrification immediately around the campus, Morand set out to prove that New Haven is having a "renaissance."  He had a slide show full of photographs.  Beautiful new buildings -- almost all of them Yale or Yale-backed buildings.  Heartwarming stories of all the efforts by Yale personnel to improve the lives of the people in the town.  Yale students and faculty running music and art programs for kids out in the "community."  Pictures of the bright new low-rise public housing projects that have replaced some of the prior grim high rises.  A new light-industrial area called "Science Park" backed by Yale to bring jobs back to an otherwise abandoned factory neighborhood.  And so forth.

Then he got to some statistics, which is where he started to lose me.  I guess he didn't realize that he might have an aficionado of population and income statistics like yours truly in his audience.  The first statistic he tossed out was that New Haven is (supposedly) "the fastest-growing city in New England."  Huh?  I knew that that couldn't possibly be right, so I looked it up immediately on my return.

According to decennial Census data compiled at Wikipedia here, New Haven reached its peak population of 164,443 in the 1950 census, and has declined to 130,282 as of the most recent (2014) estimate.  That's sure not my idea of "growth."  The same table does show that New Haven's population bottomed out at 123,626 in the 2000 census, and has increased by a little over 5% since then.  Is that what Morand was talking about?  Well, to take just one non-random example, the population of New England's largest city, Boston, while also well off from a 1950 peak of 801,444 to a current (2014) 655,884, has increased by over 11% and 66,000 people since 2000 (589,141 to 655,884).  New Haven is not even close to that.  Nearly every city in New England has lost population since peaks somewhere between 1930 and 1960 (this is true not just of New Haven and Boston, but also of Springfield, Cambridge and Lynn, MA, Providence, RI, Portland, ME, Bridgeport and Hartford, CT); but there are exceptions, notably Stamford, CT, and Manchester, NH, both of which hit all-time highs in 2014.  Stamford's 2014 population, at 128,278, is up over 9% since 2000.  How could that also not count as "faster growing" than New Haven? 

And of course, now that I knew that Morand was blowing smoke about New Haven's population, I thought to check more broadly into relevant statistics on income and poverty.  After all, New Haven has all those Yale geniuses right there, cooking up all kinds of ideas and programs to uplift the downtrodden and eliminate poverty.  Likely, after decades of this, they will have largely succeeded by now.  Right?

Actually, that couldn't be more wrong.  Here are some relevant numbers:

• According to Census data compiled here, Connecticut ranks first among the states in per capita income (although D.C. is higher) at $37,892 and second among the states in median family income (Maryland is number one) at $87,245.  But according to the data for Connecticut broken down by city and town, the per capita income for the City of New Haven is dramatically lower at $21,789, and the median family income is $47,894.   (All data from the 2009-13 American Community Survey from the Census Bureau.)  Do you have any idea how disastrous that is?  In the ranking of the states, per capita income of $21,789 would put you behind number 49 Arkansas ($22,170) and just ahead of dead-last Mississippi ($20,618).  For median family income, $47,894 puts you behind dead-last Mississippi, which has median family income of $48,471.  Wow!  And this is what Morand is trying to sell as a "renaissance"?
• How about poverty?  The most recent official poverty rate for the U.S. (2014) is 14.8%.  Readers here know that I have been critical of how that figure is compiled, but it is still useful for purposes of comparison.  Connecticut, as befits one of the wealthier states, has a somewhat lower poverty rate at 10.7%.  And New Haven?  It's 24.4%.  Wow!  That's almost double the national rate, in a city with one of the premier national universities, and right in the middle of one of the very wealthiest states.  How could they possibly have gone so wrong?

Before I left town, I thought to take a quick drive around to get my own impression of how things are going, not in the area immediately adjacent to the university, but rather in some of the remaining 80% of the town.  My verdict: sorry, but it looked worse -- a lot worse -- than when I was a student back in the 70s.  I went down Howard Avenue to the City Point area, then out Winchester Avenue to Newhallville, and back down Shelton Avenue and Dixwell Avenue.  If you don't recognize these names, don't feel bad, because almost nobody who has gone to Yale would recognize them either.  These are parts of New Haven where Yalies (except for crazies like me) just don't go.   The housing in these places is in an extremely deteriorated condition.  At least half the houses looked like they had not had a paint job in the forty plus years since I left Yale, and many had not only peeling paint but also broken, or loose, or even boarded-up, doors or windows.  Also remarkable was the complete lack of any renovation or upgrade projects in progress.  Contrast this to the former "bad" neighborhoods of New York, like Harlem, or even Bedford-Stuyvesant in Brooklyn, where renovations are going on everywhere; or to Greenwich Village, where seemingly every block has three renovations in progress.

But wait a minute.  New Haven is literally ground zero for government programs to cure poverty, with the Yale faculty in the forefront of designing and implementing the efforts.  Back in our college days, New Haven had the premier "urban renewal" program in the country, headed by one Ed Logue, who had declared the goal of making New Haven America's first "slum free" city.  From "Urban Renewal in New Haven" by Joseph Montagna, apparently written in about 1979 for the Yale-New Haven Teachers Institute:

The urban renewal program in New Haven was undertaken on a massive scale. No other city in the United States could equal the ambitious commitment to such a large scale redevelopment of its business and residential districts. On a per capita basis, New Haven outranked all American cities in securing funds which produced an impressive experiment in the physical and human rejuvenation of a city.

New Haven built public housing everywhere and was a national leader in public housing.  Today New Haven has 2,492 units of low-income public housing and 4,479 families receiving Section 8 vouchers, in a city of only 130,000.  At two per household (low estimate), that's close to 15% of the population of the city receiving low income housing assistance.  For comparison, the percent of people in the United States living in public housing is around 1% per HUD data here, and the percent receiving Section 8 vouchers is around 3%, per data here.  So New Haven has almost quadruple the percent of people receiving low income housing assistance as the national norm.  Food stamps?  Nationwide about 14% of the population receives them.  In New Haven it's more than double -- well over 28%, over 37,000 people out of 130,000, per the Yale Daily News just yesterday.  And these are just some notable examples.  New Haven is a champion of utilizing every government anti-poverty effort out there.

If these things worked even a little, one would think that New Haven would have a poverty rate somewhat below, if not significantly below, national norms.  If these things worked even a little, one would think that New Haven would have per capita income levels above, if not significantly above, national norms.  But instead New Haven has poverty double the national norm and per capita income at or below the level of dead-last Mississippi.  In other words, it's not that these programs are just not working.  They are actively destructive of work effort and of striving and of upward mobility, trapping wildly disproportionate numbers of New Haven's citizens into generations of unbreakable poverty.

So we all sat there looking at Morand's pretty pictures of the new housing projects that have replaced the old housing projects, and of the Yalies teaching music and art to the kids in the "community," and we all felt good about ourselves that finally "our" efforts to help "them" were turning things around.  That is, all of us felt good about ourselves except for me, because I already basically knew what the numbers would show when I went home and took a few minutes to look them up.

Before closing, I should mention that Morand did mention a few things that I thought were at least constructive rather than destructive.  These included efforts to lure start-up employers to New Haven and to remove some of the terrible scars left by prior "urban renewal" efforts (e.g., the "Oak Street Connector").  But left unmentioned were serious challenges faced by New Haven with no solutions short of very serious tough love.  These include uncompetitive personal and corporate income taxes and vast overhangs from near-worst-in-the-nation unfunded public pension obligations at both the state and local levels.  Not to mention vast "anti-poverty" efforts that seem designed only to increase government dependency, idleness, and anger among the subject population.  Feel-good presentations by Yale's New Haven boosters are not going to cure these issues.  If I had a business to locate somewhere, I sure know that I would not choose New Haven.  

Farewell To John Boehner

At the end of last week, House Speaker John Boehner announced that he would leave Congress within a month, and of course give up the Speakership.  

In a September 25 article by Jennifer Steinhauer, the New York Times spins the story as evidence of the divisions and disfunction among House Republicans.  

Mr. Boehner struggled almost from the moment he became speaker in 2011 to manage the challenges of divided government while holding together his fractious and increasingly conservative Republican members.   

Steinhauer also quotes Nancy Pelosi calling the Boehner resignation evidence of the "disarray" in the Republican caucus.  Perhaps.  Certainly, Boehner has been under increasing pressure from small-government types frustrated with the lack of progress in cutting back on federal spending.  But that frustration has been not so much with Boehner personally as with the insufficient clout held by Republicans in Congress who (1) face a President who wants to increase spending and to bust previsouly-enacted spending caps, (2) even after the big gains in the 2014 election, do not have enough votes in the Senate to overcome a filibuster, and (3) even if they could overcome a filibuster in the Senate, still would not have enough votes in either house to override a Presidential veto.

But measured against those challenges, how has Boehner done?  Here's something I'll bet you don't know even if you follow the news closely: since Boehner became Speaker in January 2011, federal spending has actually declined, at least in so-called "real" (inflation-adjusted) terms.  (And there hasn't been much inflation to speak of.)  That's real year-over-year declines, four years running, in the face of a President who wants exactly the opposite.  

According to federal budget and spending summaries prepared by the Heritage Foundation, federal spending hit a peak of $3.792 trillion in fiscal 2009 (at the time of the so-called "stimulus"), and remained very slightly below that level at $3.777 trillion in 2011, when Boehner took over as Speaker.  Annual federal spending then proceeded to decline to $3.644 trillion in 2012, $3.506 trillion in 2013, and $3.504 trillion in 2014.  Final 2015 numbers are not yet available (the 2015 fiscal year just ended yesterday).

Meanwhile, over that period now approaching five years, U.S. GDP has grown from about $15 trillion to almost $18 trillion per year.  That means that during Boehner's Speakership federal spending as a percent of GDP has declined from about 24% to only about 20%. That is not a small change. 

The decline in federal spending as a percent of GDP has been accompanied by many loud complaints from recipients of the spending and from the bureaucracy about "severe" and "harsh" cuts.  But here's my question for Manhattan Contrarian readers:  Can you name any example or instance where some negative change in federal spending has risen to something you can actually notice in your own life?  I sure can't.

I'll count myself among those who would like to have seen much bigger cuts in government spending than we have had.  And going forward, holding the line on government spending is quickly going to become more difficult given (1) the pressures on entitlement spending (unless reformed) from the aging and retiring baby-boom generation, and (2) the coming explosion in Obamacare spending.  And then there are the Democrats, who have multi-trillions of annual spending waiting in the wings as soon as they get a chance -- from universal single-payer healthcare, to increased Social Security benefits, to vastly increased education spending, and that's just for starters.  

So while I have my disagreements with the Congressional leadership, and Boehner was certainly not "my guy," I do think that he deserves some credit for holding the line on federal spending for a substantial period of time under difficult circumstances.  

Manhattan Contrarian Award For The Most Transparent Self-Promotion By A Government Agency

You know that it's budget season in Washington when the news pages become filled with one story after another put out by government agencies trying to get their budgets increased or, possibly, trying to avoid the budget ax.

There's a real art form to this.  Champion players of the game know that you need to come up with something that accomplishes multiple difficult goals all at once.  First, whatever it is (call it the "McGuffin")  must justify a big increase in your budget because after all, that's all that really counts in the end in Washington.  Second, the McGuffin must be associated with a seemingly plausible story that can be sold without giving any overt hint that you are just playing a totally cynical game for more money to grow your empire.  (This one is relatively easy because the press is ridiculously gullible, particularly in any area that involves growth of government.)  Third, the McGuffin needs to be sufficiently catchy that it gets on the front pages and headlines of lots of papers and web sites and news shows.

And having read those criteria, I know what you are thinking.  You are thinking that it is impossible to beat the annual "food insecurity" scam put out by the Department of Agriculture (DOA).  For those unaware of it, every year around this (budget) time, the DOA comes out with a report declaring that some 15 to 20% of Americans have been determined to be "food insecure."  (This year's report does not seem to have come out yet, but the 2014 version is here.)  This is the most cynical and blatant self-promotion by the DOA seeking more money for its food stamp and other nutritional programs.  Dozens of free-food-advocacy organizations can be counted on to immediately pick up the survey results, equate them with "hunger," and go to bat lobbying for more money for the DOA.  And the gullible press laps it up, running one article after another, never thinking to ask how the DOA can already be spending some $80 billion per year on almost 50 million food stamp beneficiaries without ever making a dent in the "food insecurity" problem (if indeed it is a problem).  The "food insecurity" metric has been carefully crafted to be completely impervious to reduction no matter how much is spent on food programs.   It's the perfect scam!

So come on, is it really possible to top that one?  Yes!  Check out the front page of today's New York Times.  It's the old NASA "we may have found water on Mars" scam!  And where there's water, there must be life!  "Liquid Water, and Prospects for Life, on Mars."   NASA held a news conference on this yesterday, reporting on a new article they have just released.

“This is tremendously exciting,” James L. Green, the director of NASA’s planetary science division, said during a news conference on Monday. “We haven’t been able to answer the question, ‘Does life exist beyond Earth?’ But following the water is a critical element of that. We now have, I think, great opportunities in the right locations on Mars to thoroughly investigate that.”    

And, he was about to add, if you just give us another, say, $50 billion a year, we can build a lot more space stuff and send it off toward Mars and keep reporting back every year for the next 50 years (at budget time) that we may have just discovered some evidence that there is water on Mars.

OK, he didn't really say that.  That would not be in accordance with the strict rules of this art form, where you are never supposed to give away that this is just cynical playing for more money.  But let's see how NASA's effort stacks up against the rules of the game:

• Does it justify a big increase in the budget?  You betcha!  Do you see Jim's reference to "great opportunities in the right locations on Mars to thoroughly investigate that."  We need to send another spacecraft to Mars!  Or how about two or three!!!  "John M. Grunsfeld, NASA’s associate administrator for science, [is talking about] sending a spacecraft in the 2020s to one of these regions, perhaps with experiments to directly look for life."
• Does it give any hint that this is just a cynical ploy to increase the budget?  Well, as totally obvious as this game is to any thinking person, the New York Times doesn't mention the subject one single time in its article.  Are the people at Pravda just particularly gullible?  Try these stories from CNN, the Washington Post, USA Today, wired -- and that's just the start of dozens of stories that can be found with a simple Google search of "NASA water on Mars."  Really, how naïve are these people?
• Does it generate lots and lots of high-profile and front-page press stories that just parrot the agency's line without asking any embarrassing questions?  See previous bullet point.

And it actually gets a little worse -- or, I guess, better, if you're looking to win the prestigious Manhattan Contrarian "Most Transparent Self-Promotion By A Government Agency" award.  A website called Quartz seems to be on to NASA's game, and points out that the U.S. has agreed by international treaty not to send any spacecraft to a place on Mars near water, since to do that would be likely to contaminate the water with earthly microbes.

[E]ven if NASA was 100% certain that there is liquid water on Mars, it could not do anything about it.  The world’s space powers are bound by rules agreed to under the 1967 Outer Space Treaty that forbid anyone from sending a mission, robot or human, close to a water source in the fear of contaminating it with life from Earth. 

So then why are they using the "water on Mars" angle to suggest research missions that actually can't be carried out?  Quartz has the answer:

NASA’s hype around the discovery of liquid water on Mars can be explained by its constant need to increase funding for its work. 

Is it possible to be any more cynically budget-grubbing than these guys?  NASA, you have won the "Most Transparent Self-Promotion By A Government Agency" award for 2015!

On The Nature Of "American Exceptionalism"

In the New York Times on Friday, David Brooks -- allegedly the house conservative -- had a column critical of many current Republicans for their views on "American exceptionalism."  According to Brooks, the defining feature of American exceptionalism has historically been its looking to the future rather than the past, including to the prospective achievements of people not yet here.

America was settled, founded and built by people who believed they were doing something exceptional. Other nations were defined by their history, but America was defined by its future, by the people who weren’t yet here and by the greatness that hadn’t yet been achieved.

I won't quibble with Brooks over whether acceptance of large amounts of immigration is an essential feature of American exceptionalism.   But there is another element of American exceptionalism that Brooks does not mention, an element that is eminently forward-looking, and yet has little to do with immigration.  That element is the role of free markets and limited government.

Free markets and limited government mean that the people "run the country," not the government.  Free markets and limited government mean an economy that is a gigantic exercise in trial and error, which turns out to be a tremendous engine for generating innovation, wealth and widespread prosperity.  Free markets and limited government mean that the country succeeds even as the government fails.  With few exceptions (all of them small), even relatively advanced other countries have the opposite, namely restricted markets and unlimited government.  Restricted markets and unlimited government mean that these countries have most or all of: sluggish and stagnant economies, lack of innovation, and high rates of government dependency.

On September 21 Bret Stephens had a column in the Wall Street Journal, discussing the upcoming visit of Chinese President Xi to the U.S., in which he commented on the difference between the results achieved in a country that allows people to run their own lives and experiment for themselves, versus a country where the supposedly superior elites dictate solutions for all:

Yes, America, perhaps the only country on earth that can be serially led by second- or third-rate presidents—and somehow always manage to come up trumps (so to speak). America, where half of the college-age population can’t find New York state on a map—even as those same young Americans lead the world in innovation. America, where Cornel West is celebrated as an intellectual, Miley Cyrus as an artist, Jonathan Franzen as a novelist and Kim Kardashian as a beauty—and yet remains the cultural dynamo of the world.  America, in short, which defies every ethic of excellence—all the discipline and cunning and delicacy and Confucian wisdom that are the ways by which status and power are gained in China—yet manages to produce excellence the way a salmon spawns eggs. Naturally. By way of a deeper form of knowing.

And yet there is almost no appreciation among American elites of the dynamo effects of free markets and limited government, with the result that those things experience gradual erosion.

Consider President Obama's speech to the U.N. on Sunday on the subjects of poverty and economic development.  OK, most of it is meaningless platitudes, and even I can find much in it to agree with.  But the overwhelming sense from reading it is that poverty reduction and economic development are the responsibility of elites who must provide for the less fortunate, rather than things that can only come about if the people are free to experiment and strive for themselves.  The main way to the goals is that "governments" and "NGOs" and "institutions" must commit "resources" to achieve them:

In just a few short years -- in the areas of health, and food security, and energy -- my administration has committed and helped mobilize more than $100 billion to promote development and save lives.  More than $100 billion.  And guided by the new consensus we reached in Addis, I'm calling on others to join us.  More governments, more institutions, more businesses, more philanthropies, more NGOs, more faith communities, more citizens -- we all need to step up with the will and the resources and the coordination to achieve our goals.  This must be the work of the world.  

And then there's this bit of hubris:

We know the ingredients for creating jobs and opportunity -- they are not a secret. . . .  We know what works.  We know how to do this.

Would that were true.  But if it were true, there is no way that Haiti would still be dirt poor, with the gobs and money and phalanxes of "experts" that are thrown at it.  In fact what happens is that the money goes straight to a corrupt government that uses it to entrench its own position and keep the poor poor.  Obama's speech does contain some sensible statements about the need for investment and encouragement of entrepreneurs.  But I'm not convinced at all that he understands what makes America and its economy exceptional.

Which Republican Candidate Is Prepared To Recognize Limits On Government's Ability To Solve All Problems?

I have often said that in matters of political philosophy, there are two fundamentally different ways of looking at the world.  Believers in Way 1 think that the government through its taxing, spending and police powers is capable of solving all of the personal problems of the people and of eliminating all down-side risk from human life.  The government's credit card is infinite!  And, as I put it on my About page,

The obvious corollary is that since all problems can be solved by taxing and spending, therefore they must be solved by taxing and spending, and anyone who stands in the way of those solutions is immoral. 

Meanwhile, Way 2 of looking at the world sees that down the road of infinite government spending to solve all problems lies the socialist fallacy and ultimate disaster, although the disaster might take a long time to unfold.  Since demands for government solutions to problems are endless and infinite, somewhere lines need to be drawn and limits set.

Clearly the Democratic candidates for President subscribe to Way 1.  Their campaigns are full of proposals for bigger and bigger new government spending to solve smaller and smaller problems, including proposals for single-payer health care for all, free college tuition for all, vast enhancements to social security, universal cures for  income inequality, and so forth.  All of this with no price tags attached, but instead a vague notion that all costs can be somehow charged to the magical top one percent of income earners.

One might think that the Republican candidates are the advocates for Way 2.  But the problem is that Way 2 inevitably leads to the necessity for drawing some lines and setting some limits, and this in the face of a usually hostile press that is always ready to accuse the candidate of immorality for standing in the way of any proposed government solution to any problem.  And so, one by one, when pressed, the Republican candidates decline to draw any lines or set any limits, and agree to go along with one or another, or multiple, of the currently-proposed big government solutions to the personal problems of the people.

Examples:

• Donald Trump has famously advocated at times for some kind of comprehensive or single-payer healthcare scheme for the United States.  A BuzzFeed article on July 17 has this quote from Trump in 1999:  “I would put forward a comprehensive health care program and fund it with an increase in corporate taxes."     Peter Suderman at Reason on August 7 has a series of amusing quotes from the first Republican debate, where Bret Baier of Fox News tried to pin Trump down on this subject.  After devoting most of his answer to the question about single-payer healthcare to the Iraq war, Trump finally got around to this: "As far as single payer," Trump says, "it works in Canada. It works incredibly well in Scotland. It could have worked in a different age, which is the age you're talking about here."    OK, that's pretty vague, but as far as I can find Trump has never explicitly disavowed his endorsement of single-payer (socialized) healthcare for the U.S., although he also has never put out any specific plan with details and costs.  The question is, where are the limits to be drawn here, if at all?
• HotAir reports yesterday that Carly Fiorina came out in 2013 for at least a form of an individual mandate for healthcare coverage.  The 2013 date is significant because it postdates the Supreme Court's 2012 decision in NFIB v. Sibelius holding the individual mandate in Obamacare unconstitutional as a mandate (although then upholding it as a tax).   HotAir quotes from a CNN panel discussion in 2013 where Stephanie Cutter of CNN asked Fiorina if she agreed with "the mandate idea," and with the "ban on pre-existing conditions," and Fiorina responded "I actually do agree with those two provisions."    To be fair to Fiorina, she went on to call Obamacare "an abomination."  But again, what are the limits she would set on government trying to achieve perfect fairness in healthcare through spending and mandates?
• John Kasich has famously supported and overseen the adoption of the massive Obamacare Medicaid expansion in his state of Ohio.  NPR has a summary of his actions and positions on the subject here.   His main defense of his actions is basically that he owed it to the people of Ohio to take the free federal money that was lying on the table.  OK though, John, you're now running for President.  Is the federal money really free in unlimited amounts, and if not, what are the limits?
• Chris Christie got big play in 2012 for his huge and, frankly, ridiculous demands on the federal government for disaster relief for Hurricane Sandy.  This was previously covered by the Manhattan Contrarian here and here.   When the Republican Congress initially refused to pass a wildly inflated $60 billion handout bill on New Year's Eve, Christie was quoted by ABC News as calling their action "disgusting."  The $60 billion went way beyond mere aid to help people get back on their feet, and included things like paying for all losses of all business, plus some $7.4 billion for unspecified "mitigation."  Shortly before that Christie had been photographed walking on the beach and hugging President Obama while making a plea for the aid.  Again, does this guy just think that the feds have infinite amounts of money to pass out, or are there some limits?
• And finally, Ben Carson has recently seemingly joined the bandwagon calling for a massive increase in the federal minimum wage.    Granted, this one is not a spending program, but still represents acceptance of the concept that the federal government somehow has the power to create fairness through mandates, without downsides like higher unemployment among the young and minority populations and higher poverty. 

And I'm sure I could come up with more examples with a little more digging.  The question is, which Republican candidate is ever actually going to say that there are limits here and the government cannot solve everybody's problems by taxing, spending and mandates?