Monday, December 5th, 2016 and is filed under Uncategorized
We hear the phrase “the free market” tossed around a lot by folks in politics and economics, but the question remains in a lot of folks’ minds: what IS the free market?
A basic definition of the free market is of a marketplace as free of regulation as possible that enables those who produce goods to interact as freely as possible with those who seek to purchase the sellers’ goods.
What drives this marketplace? Demand.
What drives demand? Either an actual need or the desire simply to have something.
In this marketplace, a perfect price point is met. To find this price point, several things must be considered: the cost to manufacture the item, the margin of profit the seller seeks AND the margin the market will bear based upon what the consumer will pay. That’s pretty much it.
The latter is critical because it drives innovation. Once a price point is met, this doesn’t mean the seller is locked into a certain margin of profit for the rest of his product’s shelf life. It simply means that this is what the market will bear at the time.
How then does a seller increase his margin of profit? By seeking to create less expensive costs of production that enables him to continue to sell the product for the same price by enjoy a larger margin of profit. Some might look at a 5% increase in the margin of profit and think, “Is that worth it?” It depends on the cost associated with the discovery/invention of the more inexpensive cost of production. Let’s assume for a moment that a seller has set the cost to purchase his product at $100. It cost him $75 to make it (production/overhead, etc), which means every time he sells a product, he enjoys a 25% pre-tax profit. If he sells 1,000 products at $100, he grosses $100,000 and nets $25,000.
Let’s now assume that the seller wishes to make more profit on his product. Without improving it, he raises the price by $25. He may enjoy some modest success, but it is likely that a buyer will think, “I used to be able to buy this product for $100 and now it is $125. I think I will look for it somewhere else for $100.” This opens the door for competition, which is one of the prime movers in a free market.
What then can the seller do if he wishes to enjoy more profit if the market rejects his price hike?
Two things. He can take some of his profit and roll it into innovating a more inexpensive way to create his product. If he comes up with a solution that saves him, in the end, 5% on production costs, this means that he can now enjoy a 30% pre-tax profit. Off 1,000 products sold, that’s now a $30,000 pre-tax profit.
His other solution could be that he attempts to improve his product. His initial product, Product A, provided the buyer with A, B and C. With minimal cost on his part, he legitimately creates a slightly better product, Product B that provides the buyer with A, B, C and D, and slaps his hoped for $125 price tag on it.
Will the market bear his new pricing? There is a good chance that it will. Will it bear it for $125? The buyers dictate this. But, if the market does bear it, then the seller has legitimately increased his profit margin by anywhere from 30-50% and his pre-tax earnings rise from $25,000 to potentially $50,000.
What then does an enterprising seller do with his increased profit? More likely than not, he will roll a portion of it into either producing more products that he can then market or he will hire another employee who will ease the burden on him and potentially increase the selling power x2.
So why write this? Because a truly free market approach does not have a government picking winners and losers. It does not slap tariffs on for profit companies looking to produce their product more cheaply.
Instead, a government’s role in the free market is to ensure that one producer does not create a monopoly that crushes innovation AND provides the environment in which businesses can thrive and innovate to produce better and better products in a competitive marketplace.
Who wins in this scenario? The seller and the buyer.
This is how the free market works. It’s that simple.
Monday, December 21st, 2015 and is filed under Uncategorized
In today’s Politico, one of the headline stories was that Ted Cruz is locking horns with the “conservative” Wall Street Journal over its coverage of him.
In the article, Ari Fletcher, former press secretary for George W. Bush (noted limited/free market conservative. . . .), rushes to the WSJ’s defense.
“In an era where print newspapers have long been on the decline, the one exception is the editorial page and the op-ed page of The Wall Street Journal, for Republican primary voters especially. They’re the gold standard,” said Ari Fleischer, a former press secretary to President George W. Bush. Calling the paper a front for Rubio, Fleischer added, is “a wrong read of the Wall Street Journal editorial page. … They’re a consistent voice for conservativism, especially on economics and supply side Reaganomics.”
Let’s break that one down for a minute. Fleischer claims the WSJ is “a consistent voice for conservatism.”
One question that begs an answer: define conservatism. Our hunch that if tossed this question, Ari Fleischer would be hard pressed to find his way out of the brown paper bag known as Big Government Republicanism.
In other words, he has no idea what he is talking about.
Why do we say that? Politico actually answers that question for us.
“Editorial page editor Paul Gigot, who notes the Journal hasn’t endorsed a presidential candidate since Herbert Hoover, said the paper’s differences with Cruz are rooted in nothing more than substantive policy differences. The paper has called for comprehensive immigration reform, backed President Barack Obama’s trade agenda in Asia and supported the NSA’s controversial metadata program to screen domestic phone calls for potential terrorism connections — and it has criticized Cruz for being on the opposite side of those issues. All three happen to be issues where Rubio — along with many establishment Republicans — is aligned with the paper.”
Quick show of hands.
Can you, dear reader, name one conservative who is for more government intrusion into our lives (NSA)? Or for comprehensive immigration reform (read amnesty)? Or, or, even better, for ObamaTrade?
No, of course you can’t.
Bottom line, the Wall Street Journal has become a hotbed of Establishment shills lead by the Paul Gigot, a man more interest in shining Mitch McConnell’s boots and the GOP Establishment than being a clear and consistent voice of free market conservatism.
Quoted in the article, Gigot says, “As for who is the voice of conservatism, I’m not sure Ted Cruz gets to define what’s conservative, but our views haven’t changed very much in 125 years.”
Newsflash, Paul Gigot.
Ted Cruz isn’t defining anything. He’s living it.
As for the “we haven’t changed at all” statement, in fact, they have changed dramatically. The Wall Street Journal that you read today is not your father’s Wall Street Journal. Whether pimping McConnell’s big government policies or attacking free market conservatives, the WSJ has lost whatever remaining shine (or credibility) it had.
Bottom line, this is a great fight for Ted Cruz to pick.
In fact, what took him so long?
Friday, October 23rd, 2015 and is filed under Blog, Uncategorized
In this episode of American History in 5 Minutes, Drew Ryun of the Madison Project discusses how the Declaration of Independence came into being, laying the intellectual foundation necessary for the American colonies to move into outright rebellion against King George III and the British Empire.
Monday, September 21st, 2015 and is filed under Blog, Elections, Uncategorized
In 2010 she ran as a pro-life conservative to replace retiring Senator Judd Gregg in New Hampshire, narrowly squeaking past Ovide Lamontagne in the Republican primary (we endorsed Ovide) before cruising to victory in the general election with 60% of the vote.
Entering the United States Senate with her conservative bone fides, many expected Ayotte to be a transformative force. She has been anything but transformative, quickly falling into the pattern we have seen established by many GOPers. Run as a conservative, govern as a liberal.
During her first Congress, Ayotte “enjoyed” a 73% on the Heritage Action scorecard. In the 113th Congress, she dropped to 48% and in the 114th, her slide into abysmal continued to a 29% against the average GOP Senator score of 62%.
On our Performance Index (that measures Members of Congress to their districts and states), Ayotte scores a paltry -15.
In the 114th Congress, she has already voted:
*To Fully Fund Executive Amnesty
*For Same-Sex Benefits
*To Undermine Religious Liberties
*To Reauthorize No Child Left Behind
*To Renew Funding For The Ex-Im Bank
*Against The First Amendment Defense Act
Her latest foray into the art of run as a conservative, govern as a liberal, has been to serve as the GOP Establishment’s hatchet man (woman) against Senator Ted Cruz’s efforts to defund Planned Parenthood through the Continuing Resolution process.
Let’s establish the pattern for the Ayotte types. It generally starts with, “There is no one more pro-life than I am (no one!!). I support investigating Planned Parenthood. I voted for the stand alone bill to defund Planned Parenthood.”
Then there is the inevitable “but” thrown in there.
Ayotte’s, predictably, is: we just don’t have the votes because we don’t have the White House. If you think you’ve heard this line before, see Mitch McConnell.
Backing up the first excuse is the alarmist: we can’t shut down the government over this!
Quick question for Senator Ayotte-how pro-life are you that you would surrender before the fight to save hundreds of thousands of babies begins?
But here is where the ignorance of Senator Ayotte shines through.
There is no such thing as a government shutdown. Slowdown, yes. Shutdown, no.
In fact, in the longest government slowdown in history (1995-96, 21 days) all non-essential government employees were furloughed and guess what? Employees defined as those performing duties vital to national defense, public health and safety, or other critical operations kept right on working. It makes you wonder why we have “non-essential” government employees in the first place, doesn’t it?
Bottom line is this. Kelly Ayotte has not come remotely close to fulfilling her promise as a conservative in the United States Senate. Not only has she fallen in with bad company, she is now helping lead their charge.
While she frets that a government shutdown may ruin her chances to re-election, we cast a quick glance at her scorecard averages and performance index numbers and ask, “Why would any voters in New Hampshire vote to re-elect you? If given the choice between a legitimate liberal and a knockoff one parading as a conservative, go with the authentic one.”
Wednesday, June 17th, 2015 and is filed under Blog, Economy, Elections, Uncategorized
Running for President is a game of high stakes. There is little margin for error, especially if you are a Republican.
It’s no secret there is groupthink amongst the political subset known as reporters. Products of our increasingly intellectually rigid “academic” institutions, these would be purveyors of news come from a worldview and ideology diametrically opposed to that of the Republican Party.
Increase that tenfold or more when it comes to conservatives. “Far rightwing” and “extremists” are among the other monikers the news makers toss out there to attempt to paint the conservative movement as out of touch with what they think is real America.
Never mind that nothing statistically bears this out. Limited government, freedom loving, individual liberty minded Americans are conservatives and are the majority today in America.
Yet, on climate change and other “settled” issues, the liberals inside the media live in their own world, eager to please others in their subset while spouting opinions (not news) that they think the herd will approve. In their minds, the knuckle draggers are the conservatives.
Enter politicians like Ted Cruz. He is an insult to them because he does not fit the straw man mold they have created for conservatives and therefore he will never win them over.
Make no mistake. He’s not perfect.
A general rule of thumb in politics is not that politicians will disappoint you. That’s a given. It’s the ones that will disappoint you the least that we should celebrate. Ted Cruz absolutely falls into that category. As such, he walks a tightrope daily between the media attempting to discredit him, a GOP leadership trying to derail him and a grassroots base eager to anoint him the Chosen One.
Let’s be honest, though. Ted made a misstep in recent months by being hoodwinked by Paul Ryan’s pencil behind the ear routine on Trade Promotion Authority (TPA).
While in the past TPA efforts have been mostly good, the current TPA is fraught with all kinds of political pitfalls as it is tied to Trade Adjustment Assistance, a big government program favored by the Democrats and their labor union allies, and the secretive Trans Pacific Partnership (TPP), Transatlantic Trade and Investment Partnership (T-TIP) and Trade in Services Agreement (TiSA).
In other words, in the end, this is not your daddy’s TPA. This has rightfully earned the nickname “Obamatrade” for the “pass it and find out what is in it” mentality swirling around it.
So what is Ted Cruz to do? He’s out there already has 1) penned an op-ed supporting TPA 2) having voted for TPA in the Senate and 3) attempting to defend his vote. The response from the conservative grassroots has been one of outrage and justifiably so. While supporters of free trade, they smell a skunk in the details of the TPA and want Ted to walk his support for it back.
It’s hard for politicians to say, “I was wrong. Sorry about that.” They are Type A’s which is both blessing and curse and that sort of thing does not come easily.
However, a lifeline was thrown to Ted in the last few days as it became apparent that TPA and the associated vehicles are hiding a small business tax hike. Now, not six weeks from now, is the perfect opportunity for Ted to pivot and say, “I love free trade. It’s what our nation is built on. But I cannot abide a tax hike on small businesses-they are the lifeblood of the American economy and I will stand with them every step of the way. In light of this, I am removing my support from TPA.”
Whether he takes the lifeline thrown to him or not remains to be seen.
But with one camp already against him (the media), Ted cannot afford to have one that has been to this point firmly with him (the grassroots) turn against him.
Monday, June 15th, 2015 and is filed under Blog, Elections, Uncategorized
With the Supreme Court about to wrap up for the summer, many know that THE big decisions are being held until the very last day of their term (either June 29 or 30).
Among the cases waiting to be settle is the King v. Burwell case, which challenges the legality of the tax credits offered to those who signed up for Obamacare via the federal marketplace at www.Healthcare.gov.
It seems as though, similar to the case in 2012 that stated Obamacare was legal on the premise that it coincided with Congress’ right to levy taxes, the decision will likely be close and rely on the votes of one or two of the justices (in 2012 that one vote was Chief Justice John Roberts).
Nonetheless, there is a great chance that later this month, the Supreme Court will deem the federal subsidy unconstitutional.
Last week at the 41st G7 Summit Conference in Germany, President Obama clearly stated that he does not have a plan if the federal subsidy part of Obamacare were to be struck down by the court. When asked about having a backup plan, the President simply answered, “if someone does something that doesn’t make any sense, then it’s hard to fix.”
What Obama is really attempting to do is to blame conservative members of Congress and use his presumed political high ground to create the image that those opposed to federal subsidies are essentially against legitimate healthcare reform. As the Heritage Foundation noted in a recent paper, if the federal subsidies are deemed unconstitutional, this does not mean that there will be a loss of coverage for millions of people. It’s just that the Band-Aid of federal subsidies will be ripped off, the real cost of socialized medicine will set in and people will have to make the choice: a Rolls Royce or a Ford? When this happens, we believe people will clamor for legitimate healthcare reform and a wide variety of options, not just the healthcare plans the government approves.
Let’s be clear on one thing, though. This notion that the GOP is to blame for the problems caused by the dismantling of a great part of Obamacare is absolutely not accurate.
According to healthcare.gov, premiums for Obamacare have been requested to increase by double-digit percentages in the upcoming year in every state (data was not available for CA, CO, MA, and CT). Regardless of the battle taking place in the Supreme Court, healthcare costs are still on the rise and the promise for affordable and efficient healthcare ultimately comes out to an unfulfilled promise by the President and the drafters of the Affordable Care Act.
In other words, it’s their fault.
So, why is this a great concern for the GOP and conservatives?
In his statement at the G7 Summit, President Obama repeatedly stated that Congress could fix this issue with Obamacare if they wanted to. To some extent they can. But rather than playing the President’s game, conservative leaders need to find a free market solution for healthcare that is fair.
Conservative leaders and candidates have the chance to prove once and for all that Obamacare is simply ineffective and unlawful and in turn, does not give the nation the best chance to provide affordable and efficient healthcare.
Monday, June 15th, 2015 and is filed under Blog, Elections, Uncategorized
There is a discussion going on in Washington, DC currently and it goes to the make-up of the House Republican Caucus.
The question in everyone’s mind is: how conservative is this caucus?
If one were to look at the current leadership, one could come up with the conclusion: not very.
To some extent, this is a fairly accurate description. Leadership should reflect the Members.
But we think that conclusion misses part of the picture.
Years ago, when current Madison Project Chairman Jim Ryun, was a Member of Congress, if one belonged to the Republican Study Committee (RSC), one was de facto a conservative. No questions asked.
Over the years, the RSC has become a watered down resume builder for many Members so they can go home and tout it to their constituents (“Of course I am conservative-look, I belong to the RSC!”).
If one were to look at current RSC Members like Cathy McMorris Rogers (a 59% on the Heritage Action scorecard), Frank Lucas (also a 59% on the Heritage Action scorecard) or Kristi Noem (a 60% on the Heritage Action scorecard) among many others, however, one wonders why it even exists anymore.
It is this current state of affairs that gave rise to the House Freedom Caucus, the new bastion of conservatism in the House of Representatives. It is this caucus that has forced John Boehner and other members of the GOP elite to operate in ways that we already knew they were inclined to, but were never forced to.
Now, instead of negotiating with their own caucus first, Boehner and Co. go directly to the Democrats to ram more big government legislation through.
The problem right now for conservatives in Congress is not that they aren’t conservative enough. It’s that there are not enough of them. Which is why we need to 1) protect the good conservatives already in Congress and 2) reinforce them with others. The political math involved in this is very real and it is very simple.
We need more good folks in Washington, DC and we need them now.
So if you haven’t already checked out our Madison Project Candidates Page, do so today and learn more about the candidates we are convinced will do two things in the next Congress-vote for new leadership in the GOP Caucus and continue to push for legislation that turns this country around.
Monday, June 15th, 2015 and is filed under Blog, Elections, Uncategorized
There is a shifting dynamic in our home state of Texas. For years, to the untrained eye, the federal delegation from Texas has appeared to many to be among one of the most conservative delegations in the nation. However, nothing could be further from the truth.
As our Performance Index shows, many of the Members of the Texas Congressional delegation are not a reflection of their districts or state with some performing as low as -37 on the Madison Performance Index (MPI).
In a word, that is abysmal.
As the state legislature has become increasingly conservative with the likes of state reps Matt Krause, Craig Goldman, Jeff Leach, Jonathan Stickland and others along with newly minted state Senators Konni Burton, Bob Hall and Lois Kolkhorst, it is time to turn in earnest to challenging the federal delegation.
In light of that, our first Texas endorsement goes to Matt McCall who is challenging Lamar Smith in TX-21 (a man with a -17 on the MPI). While a strong voice against illegal amnesty, Lamar has a lifetime score of 71% on the Heritage Action scorecard and a 73% lifetime score on the Club for Growth’s scorecard. In a district that has a Cook Partisan Voting Index number of R+12, it’s clear that we must replace Lamar with a conservative committed to wholesale change in Washington, DC.
That conservative is Matt McCall. Not only is Matt strong on illegal immigration (likely even stronger than Lamar Smith), he checks all the boxes on fiscal and social issues and we believe that Matt will not only match the make-up of TX-21, he will likely exceed expectations. To read more on Matt, see his bio here.
Make no mistake. This is going to be an uphill climb for Matt against a deeply entrenched incumbent. But we have seen challengers overcome greater odds which is why we are happy to endorse Matt McCall in his run for Congress.
Friday, June 12th, 2015 and is filed under Blog, Elections, Uncategorized
As an Indiana state Senator since 2010, Jim Banks’ resume is one filled with several conservative accomplishments. Ranked one of the top conservatives in the entire Indiana state legislature, Jim is a Navy reserve officer who took a leave of absence from his state Senate seat to serve our country in Afghanistan last year.
He is not just committed to promoting freedom through supporting limited government; he’s actually fighting on the battle lines to preserve it.
More importantly to us, as we have chatted with him, it is clear that Jim understands the current dynamics in Washington, D.C. and is not afraid to commit to opposing the status quo even if it means standing up to his own party when he wins this race for Indiana’s 3rd Congressional District.
During his time in the Indiana state legislature, Jim has co-authored or co-sponsored bills that repeal the death tax, created a statewide voucher system and introduced Right to Work to Indiana. Coupled with his fiscal conservatism, Jim has maintained a 100% pro-life voting record during his tenure, co-authoring numerous pro-life bills along the way.
Jim Banks has proven himself in the legislative trenches and it is time for us to move him from the political bench of the state legislature and into the game of federal level politics.
As we have continually noted, the change needed in Washington, D.C. is not going to take place overnight. It’s going to be a process of multiple election cycles that becomes twofold: electing new conservatives to office and defending the ones who continue to prove their mettle once elected.
It is without hesitation that we endorse Jim Banks in his run for U.S. Congress and look forward to helping him win not only his primary, but the general election as well.
Tuesday, June 2nd, 2015 and is filed under Blog, Uncategorized
Part of the problem for conservatives is the disconnect that many American taxpayers have with Washington, D.C. and the decisions made there. The average American taxpayer knows something is wrong, but because they are working to make ends meet (several working two or more jobs) they don’t know all of the specifics when it comes to legislation being considered or passed. This disconnect is also partly due to the fact that so much goes wrong in Washington, D.C. The inside baseball discussion of legislation takes place every day and many taxpayers are not part of that conversation.
Such is not the case of the Export-Import Bank (Ex-Im).
Created by executive order by FDR, the Ex-Im Bank’s charter was “to create and sustain U.S. jobs by financing sales of U.S. exports to international buyers.”
However, in recent years, the Ex-Im Bank has become a slush fund for corporations that don’t need the money, but would rather not shoulder the risk. The risk is, however, placed in the lap of the American taxpayers to the tune of hundreds of millions of dollars of loans subsidized each year with taxpayer dollars.
Loans like the $126 million one to the China National Nuclear Power Corporation or the millions of dollars in loan guarantees to customers purchasing Boeing aircraft. It is the essence of corporate welfare and a slush fund used to manipulate the free market.
While defenders of the Ex-Im Bank will argue that the bank helps level the playing field for small businesses in America, the fact of the matter is that in 2012, 82% of the bank’s loan guarantees went to Boeing’s customers.
At the end of this month, the Ex-Im Bank is up for reauthorization and its future is in jeopardy. Why? Because the foundation on which its current iteration is built (Congress) is shifting underneath it. A new breed of conservatives have been elected to office the last few election cycles, many of whom are Madison Project endorsed. As proponents of the actual free market, not a manipulated one, they are fighting to let the authorization for the Ex-Im Bank lapse at the end of this month.
It’s as simple as that. But make no mistake – there will be a fight over the next few weeks as the GOP leadership attempts to ram it through Congress, potentially attempting to attach it to the Defense Reauthorization bill to create a conundrum for the Ex-Im Bank’s critics.
Stopping it could be a huge win for the conservative movement, but we’re going to need all hands on deck to stop it and begin rolling back the largesse of the big government/big business crowd that has become far too comfortable playing with the American taxpayers’ money.