Why Is the Left so Sensitive about Cuba?

I touched a raw nerve with my post about Fidel Castro admitting that the Cuban model is a failure. Matthew Yglesias and Brad DeLong both attacked me. DeLong's post was nothing more than a link to the Yglesias post with a snarky comment about "why can't we have better think tanks?" Yglesias, to his credit, tried to explain his objections.

This leads Daniel Mitchell to post the following chart which he deems “a good illustration of the human cost of excessive government.”...this mostly illustrates the difficulty of having a rational conversation with Cato Institute employees about economic policy in the developed world. Cuba is poor, but it’s much richer than Somalia. Is Somalia’s poor performance an illustration of the human costs of inadequate taxation? Or maybe we can act like reasonable people and note that these illustrations of the cost of Communist dictatorship and anarchy have little bearing on the optimal location on the Korea-Sweden axis of mixed economies?

I'm actually not sure what argument Yglesias is making, but I think he assumed I was focusing only about fiscal policy when I commented about Cuba's failure being "a good illustration of the human cost of excessive government." At least I think this is what he means, because he then tries to use Somalia as an example of limited government, solely because the government there is so dysfunctional that it is unable to maintain a working tax system.

Regardless of what he's really trying to say, my post was about the consequences of excessive government, not just the consequences of excessive government spending. I'm not a fan of high taxes and wasteful spending, to be sure, but fiscal policy is only one of many policies that influence economic performance. Indeed, according to both Economic Freedom of the World and Index of Economic Freedom, taxes and spending are only 20 percent of a nation's grade. So nations such as Sweden and Denmark are ranked very high because the adverse impact of their fiscal policies is more than offset by their very laissez-faire policies in just about all other areas. Likewise, many nations in the developing world have modest fiscal burdens, but their overall scores are low because they get poor grades on variables such as monetary policy, regulation, trade, rule of law, and property rights.

So, yes, Cuba is an example of "the human cost of excessive government." And so is Somalia.

Sweden and Denmark, meanwhile, are both good and bad examples. Optimists can cite them as great examples of the benefits of laissez-faire markets. Pessimists can cite them as unfortunate examples of bloated public sectors.

P.S. Castro has since tried to recant, claiming he was misquoted. He's finding out, though, that it's not easy putting toothpaste back in the tube.

Clinton Was Much Better than Bush

Some of my posts spark debate between Bush supporters and Clinton fans, particularly on my Facebook page. I hate to burst anyone's bubble, but Clinton wins that contest hands down. I'm only talking about economic issues, to be sure, so I'm not looking to trigger any discussions about foreign policy or abortion.

Regarding economic issues, perhaps the key thing to understand is that there are many factors which determine economic freedom (which, of course, is related to growth and prosperity). Some people look at a high-profile issue such as taxes, and are tempted to rank Bush higher because he cut taxes in 2001 and 2003, whereas Clinton increased taxes in 1993 (he also cut taxes in 1997, but not as much as he raised them four years earlier).

But while Bush had a better record on taxes, he had a much worse record on spending. And as I wrote in the Washington Examiner a couple of years ago, Bush's record in other areas was more statist than Clinton's (and I was writing before the bailouts).

Perhaps the best way of showing the difference between Bush and Clinton is to examine the Economic Freedom of the World annual rankings. Not all the years are available, but the image below clearly shows that economic freedom rose during the Clinton years and fell during the Bush years.

I'm no great fan of Bill Clinton, and I'll be the first to admit that many of the good things that happened under Clinton were the result of a GOP Congress (in the good old days before they were corrupted by compassionate conservatism). But also keep in mind that Clinton signed into law almost all of the good policies that were enacted during his reign. Likewise, Bush signed into law almost all of the bad policies that were enacted during his reign. If I'm choosing between the economic policies that were implemented by the previous two Presidents, the answer is obvious.