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Hendrickson's View

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Hendrickson’s View

Mark W. Hendrickson

Mark Hendrickson is an economist who recently retired from the faculty of Grove City College, where he remains a Fellow for Economic & Social Policy for the college’s The Institute for Faith and Freedom. These essays are republished from The Institute for Faith and Freedom, The American Spectator, and The Epoch Times.

“Climate: The Movie” — Review

Earlier this month, English writer, director, and producer Martin Durkin released “Climate: The Movie (The Cold Truth).” Mr. Durkin’s 80-minute film presents what is known as the “skeptic” side of the climate change debate, as opposed to the “alarmist” camp. (Full disclosure: I have been firmly on the skeptic side for decades, having written multiple commentaries on the topic for The Epoch Times.)

One commendable feature of “Climate: The Movie” is how well organized it is. Mr. Durkin discusses various aspects of climate change one at a time, starting with the science of climate change, warm and cold periods in Earth’s history, the role of carbon dioxide and other factors (e.g., solar activity and cloud cover) in affecting temperatures, the political corruption of scientific research through the control of vast amounts of federal funding dispensed to various scientists, and the bullying that led to the establishment of a mythical “consensus” on climate change, and closing with sections titled “Climate versus Freedom” and “Climate versus the Poor.”

The value of his organization of the film into a series of related but distinct issues is immense.

Let’s say a viewer disagrees with the descriptions of temperature change as benign and nonthreatening or with the assertion that carbon dioxide (CO2) is not the “knob” controlling the world’s temperatures. (Here I wish he had included more information about how beneficial the increased concentration of CO2 in Earth’s atmosphere has been — specifically, how much land has been greened and how much agricultural productivity has been enhanced by the CO2 enrichment of the past century or so.)

Perhaps a viewer is skeptical about the movie’s argument that the temperature records cited by alarmists suffer from significant distortions. (Here I regret that Mr. Durkin failed to show the extent to which government agencies falsify — what they euphemistically call “adjust”—historical data or how a majority of U.S. thermometers may be skewed by being placed near heat sources).

Maybe a viewer isn’t ready to admit that the government has played such a massive role in commandeering scientific research that the so-called settled science is nothing but government propaganda. Even then, a viewer who is genuinely concerned about human well-being should be willing to ponder the movie’s points that the alarmists’ alleged remedy involves a massive loss of individual liberty and that they are advocating anti-human policies that would oppress the world’s poor and retard, if not thwart completely, their attempts to climb out of poverty.

The movie is well-paced. This is no easy accomplishment, since any discussion of the science of climate change inevitably involves the depiction of graphs and a series of talking heads to explain the significance of various data. At times — particularly when going deep into our planet’s history — the director resorts to using cheesy film clips from the 1950s or earlier. This actually helps counter any tendency toward monotony that can come from overexposure to talking heads.

Speaking of talking heads, the ones in this movie are noteworthy. They include a Nobel Prize winner in physics, a founder of the environmentalist group Greenpeace, and scientists and professors at the top of their professions, some of whom have served as science advisers to both Republican and Democratic presidents.

One thing a viewer may notice is that most of the talking heads are senior citizens. The reason for this seeming imbalance is explained in the narrative: Younger scientists seeking funding for their research and job security have to keep quiet about any doubts they have about the alarmist scenario or else they endanger their livelihoods and careers. The movie raises the crucial point: If scientists aren’t free to tell the truth, how can the rest of society remain free?

The concluding segments of “Climate: The Movie” focus on the most important dimension of the climate alarmist issue — that it is a pretext for an aggressive political agenda. As discredited as socialism has been by the wretched experience of countries unfortunate enough to have fallen under its sway, if you pull back the curtain from the alarmist scenario, what you find is a gaggle of elitists who still cling to the socialistic idea that a relatively small number of people can devise a better society and world by centralized, top-down planning. This is the cabal or cult that seeks to tell us what kind of cars to drive; what kind of water heaters, air conditioners, and stoves our rulers will permit us to use; and to force a transition to intermittent sources of power generation that could lead to catastrophic failures of our country’s electricity grid.

Millions of Americans should watch this movie. It sounds a timely warning about the political regimentation into which the climate alarmists in government wish to herd us. “Climate: The Movie” has the potential to cure younger viewers of the needless anxiety that millions of them reportedly feel after being subjected to alarmist propaganda in schools.

Prediction: You will hear alarmists trash this movie ferociously. Who can blame them? After all, we all know that the truth hurts.

The Destructive Corporation-Bashing of the Left

The left’s constant corporation-bashing manifests gross ignorance of a salient economic truth: Corporations are the major economic benefactors of our country.

One of my cousins has been bombarding me in recent months with a steady stream of corporation-bashing emails from various left-wing and Democratic organizations. The animus against corporations is vehement, to say the least. And that animus will be a feature of President Joe Biden’s reelection campaign, as was made clear in his State of the Union (SOTU) Address on March 7.

By the way, compliments to those who wrote President Biden’s SOTU speech. (Full disclosure: I didn’t watch it, so I am basing my comments on the transcript that I read.) Democratic spin doctors did yeoman work, using the SOTU to sweep President Biden’s policy failures under the rug and paint a beguiling picture of an imaginary Santa Claus government in which Team Biden will take care of our economic needs.

One major problem with President Biden’s saying he wants a future in which the “biggest corporations no longer get all the tax breaks” is that he himself has given corporations massive breaks. President Biden glibly ignored the massive subsidies that his administration has handed out to politically connected (i.e., crony) businesses carrying out the president’s so-called green agenda. As is so often the case with politicians, President Biden’s deeds don’t match his rhetoric.

Later in his address, the president trotted out that tired line about “making big corporations . . . finally [begin] to pay their fair share” of taxes. In progressive lingo, “fair share” is code for “more.” Actually, however, I agree with President Biden and the anti-corporation left that it seems unfair when a corporation (according to one of the emails my cousin sent to me) earns an annual profit of $7 billion and has a tax rate of minus 6 percent, and another corporation pays a 1.5 percent tax rate on earnings of $3 billion, while other businesses pay significantly higher rates. Such disparities are due to various deductions, credits, and so forth (i.e., “loopholes”) that Congress has written into the tax laws.

There is, however, an effective way to eliminate the unequal taxation of corporations. There is only one indisputably “fair” corporate tax rate (“fair” being defined as applying impartially the same to all): zero percent.

Yes, it would be better if we would abolish the corporate profits tax entirely. Not only does the corporate income tax introduce economic inefficiencies, impose enormous compliance costs, and induce an over-reliance on debt, but it also is the least efficient form of taxation. Some years back, a study by the decidedly pro-tax Organization for Economic Cooperation and Development (OECD) concluded that “corporate taxes are found to be most harmful for growth, followed by personal income taxes and then consumption taxes.”

Abolishing the corporate profits tax (along with all their related credits, exemptions, and so forth) would eliminate the present unfairness of corporations’ paying different rates and such absurdities as a negative tax rate for some corporations.

First, for those of you concerned that Uncle Sam will lose revenues to fund ever-bigger government, that loss could be offset in two ways: (1) by eliminating the massive subsidies that government bestows on favored businesses, and (2), by supply-side effects. Domestic businesses would be more able to expand, and more foreign corporations would set up operations here — both resulting in an employment boom that would result in increased government revenues from personal income taxes.

Second, for those of you thinking that the rich would get richer if corporate profits were not taxed, reams of economic research show that the lion’s share of the costs of the corporate profits tax falls on workers. (Read the Tax Foundation’s article “Labor Bears Much of the Cost of the Corporate Tax” if you are interested in investigating.) Two years after the adoption of the Trump tax reform that lowered the corporate profits tax, as even The Washington Post acknowledged, the U.S. workforce was enjoying the lowest overall unemployment in half a century, all-time highs in employment for black and Hispanic workers, and strongly rising wages.

Returning now from the economics to the ethics of tax reform, in addition to the dubious ethics of taxing corporations at different rates, there is a second major ethical problem inherent in taxing corporate profits. Corporations are not technically the owners, so much as the custodians, of the financial assets sitting in their accounts. Moreover, the corporation is a fictitious person, and one of the oldest truisms in public finance is that real human beings actually pay all taxes. Corporate salaries and bonuses, dividend and interest payments, and capital gains realized when stockholders sell shares at a profit represent real income to real people, and it is at that point that they should be taxed.

Just as unrealized capital gains shouldn’t be taxed, neither should unspent corporate profits. Both represent potential wealth to individuals, not actual present income. Corporations have a fiduciary responsibility to deploy the monies that remain in corporate accounts above their expenses for the benefit of the legal owners of the corporation. As is sadly habitual on the left, they have an insatiable appetite to get their hands on other people’s money, and they don’t want to wait until money becomes realized personal income before making a grab for it.

The left’s constant corporation-bashing manifests gross ignorance of a salient economic truth — namely that corporations, although not without faults (the most egregious of which are those businesses that form crony relationships with government), are the major economic benefactors of our country. They employ millions of Americans while producing goods or providing services that have given us a standard of living that greatly exceeds what our grandparents had.

There is something perverse, if not morally repugnant, about stirring up envy and resentment against the very enterprises that are responsible for American prosperity. But as long as voters remain economically ignorant, they will fall for the anti-business canards of the left. That is the political reality.

Lessons from History: Some Enlighten, Some Confuse

Let’s keep our minds fixed on two of the most important lessons of history: Peace is far better than war, and the present is far better than the past.

Possibly the most famous quote about history is the philosopher George Santayana’s pithy, “Those who cannot remember the past are condemned to repeat it.” There is much wisdom in that statement. Still, it also seems true, in some cases, that those who do remember the past are condemned to repeat it.

Think of hereditary hostilities, the multi-generational conflicts, and centuries-long feuds. One of the most prominent and long-lived examples of this phenomenon is the perennial animosity between Jews and Muslims with its current iteration in Gaza. Here, blind hatred for or mistrust of “the other” — the permanent historical enemy — stretches back over a thousand years.

Millions of children have been raised to hate all those who belong to the other group. They are taught that those others are mortal foes, guilty of the alleged sin of having been born into (and in rarer cases, converted to) the religion of “the other.” They are taught that it is good and right to try to annihilate “the other” — that a noble goal in life is to kill people whom they have never met, people with whom they might share common goals in life, such as living in peace, worshiping God in the manner of their choosing, raising families, and leading a productive life. Why should such strangers be killed? Because history says so. History says that A’s grandfather killed B’s aunt and uncle, and earlier generations perpetrated similar deeds, so that’s the way it is supposed to be. That kind of history amounts to fatalistic resignation. The past is prologue; history is destiny.

Countering the grim mindset that holds violence and conflict to be inevitable, an observer can take heart in the example of Jewish and Muslim individuals in countries around the world who, even while hostilities are ongoing, are striving to break the long chain of hereditary hatred and historical habits. These are often noble individuals who have suffered personal losses from this ancient rivalry — brave people daring to defy groupthink and ask the vital question: Do we really want our children to live in the same toxic atmosphere of hatred and violence that has caused the tragic deaths of so many of our relatives, both recent and ancient?

There is another lesson that history offers to teach us — what I would call a “mega-lesson”: That peace is better than war for human well-being and societal flourishing. Look at it from an economic point of view: If one surveys the entire span of human history, there is one overriding economic mega-trend that stands out above all others: The expansion of the division of labor.

Early human families and clans learned that they could have more wealth (i.e., food, shelter, clothing) if each member of the society specialized in supplying what they were relatively skilled at providing. They then shared or traded their surplus with each other rather than trying to provide for all their needs by themselves. As humans gradually learned that a more extensive social division of labor raised their standard of living, clans formed tribes, tribes formed villages, villages developed into cities, etc. Along the way, enterprising individuals further expanded the division of labor by trading with strangers across town, across valleys and plains, across continents, and eventually across oceans.

The more people who are included in the social division of labor, the greater the resulting productivity and the higher the standard of living. The division of labor performs its wealth-creating wonders to the degree that peace and freedom prevail. War is a great crippler of the division of labor. War destroys wealth (various forms of property) and wealth-producers (i.e., human beings).

Ask the Germans and French today if they prefer living and trading in peace rather than trying to conquer or destroy each other like their predecessors did. Those peoples warred for generations. Eventually, though, they grew to understand that life would be far better for far more Germans and French through peaceful cooperation rather than war and destruction. How long will it take the combatants in the Middle East to arrive at this understanding? Who knows? Hopefully the wisdom of those now working for peaceful coexistence will someday lead to an end of heretofore-endless wars.

Shifting gears, there is another important mega-lesson that history can teach us if we are willing to learn it. This is particularly timely during Black History Month. I am thinking of the “1619 Project” — the effort to slant the history of the United States to see everything in racialist terms by asserting that the driving force for the settlement of North America by Europeans was to establish slavery. Here is a simple fact of history that is beyond dispute: The past was dreadful — and not just for Africans brought to the New World as slaves, as abominable as that was. If Americans of European descent were interested, willing, and able to go back in time and observe their ancestors, I’m sure that almost all of them would find abuses, injustices, and a long list of grievances, too.

The wretchedness of human history is no revelation or radical theory. The plain fact is that for most of human history, up until just a few centuries ago, human life was, in the memorable phraseology of Thomas Hobbes, “nasty, brutish and short.” The vast majority of the human population suffered from chronic poverty, precarious health, and various forms of injustice and oppression. The vile institution of slavery was practiced on every inhabited continent. You don’t have to dig hard at all to find historical examples of how awful human life was and how horribly some people treated their fellow human beings.

So, what is the lesson here? Simply this: Human life is enormously, incalculably better today than it was for most of human history. Let’s acknowledge the gigantic strides of progress that have been made. It is cruelly ironic that the more progress humans have made in rising above the grimness of our shared history, the more people tend to criticize us for not having achieved perfection.

The past was grim and harsh. The good news is, the past is past. Rather than dredge up ugly historical practices to make us miserable today, let’s be glad that we live today. Let’s be grateful that we are free to strive for additional progress. What a great opportunity we have! Let’s not squander that opportunity by dragging the sufferings of bygone generations into the present. That is an egregious abuse of history. Let’s keep our minds fixed on two of the most important lessons of history: peace is far better than war, and the present is far better than the past.

The Might and Majesty of the Risen Savior

At Eastertime, Christians rejoice and give praise for the resurrection of mankind’s Savior.

Words often fall short of communicating the full magnificence of the Lord Jesus Christ. Let me try by offering that he was the most complete package ever to grace this earth. He was the supreme example of both meekness and might — widely different qualities that often are mutually exclusive in a typical human being, but were a divinely natural and necessary combination in the Savior. Indeed, as both Son of God and Son of Man — as both divine and human united in one individuality — Christ Jesus was perfection incarnate, a majestic and unique wonder, the contemplation of which should inspire, awe, and humble us.

The meekness and humility of the Lord are unmistakable in word and deed. He declared, “I can of mine own self do nothing. . . . I seek not mine own will, but the will of the Father which hath sent me” (John 5:30) and when he was addressed as “Good Master,” he replied, “Why callest thou me good? There is none good but one, that is, God” (Mark 10:17-18). In vivid and sublime demonstration of his meekness, he knelt and washed his disciples’ feet (John 13:1-15).

This humblest and most selfless of men was also a man of great courage, power, and dominion.

Jesus’ courage was manifest by the way he repeatedly defied the Pharisees who were looking for a pretext to destroy him, calling them “hypocrites” and “vipers” (Matt. 23) and boldly healing a withered hand in the synagogue on the Sabbath (Luke 6:6-11). He showed magnificent courage by steadfastly insisting on going to Jerusalem, even though he knew that he would be betrayed and condemned to death (Matt. 20:18), going so far as to deliver a stinging rebuke to Peter — “Get thee behind me, Satan!” (Matt. 16:23) — when Peter spoke of protecting the Lord from meeting his destiny.

God’s anointed one repeatedly did things believed to be impossible. The spiritual power he demonstrated exceeds even the most marvelous accomplishments of modern technology. He overcame the laws of physiology, as when he restored sight to the man born blind (John 9:1-7, 32) or instantly healed ten lepers (Luke 17:11-19). He trumped the laws of biology and medicine, when he raised Lazarus from the tomb four days after his death (John 11:1-44). He nullified the laws of physics and meteorology, walking on the water (Matt.14:22-33) and stilling the tempest (Mark 4:35-41). He overruled the laws of botany and agronomy, feeding multitudes on at least two occasions with a few loaves of bread and a few fish (Mark 6:30-44 and 8:1-9).

The Savior proved with irrevocable finality his everlasting dominion through the sequence of events that we commemorate during Holy Week. Throughout the awful drama of his betrayal, arrest, torture, condemnation and hideous execution, he proved that God always reigns supreme. When the men sent by the high priests and Pharisees came to Gethsemane, an invisible force knocked them backward onto the ground (John 18:6). His disciples should have taken that as a sign: God was in control, no matter how bleak the picture looked. And so it proved. Jesus permitted the crucifixion to take place. Basically, he challenged his enemies to take their best shot at trying to obliterate his life. They failed; it was beyond their power. On the following Sunday morning — that first Easter — the Savior proved his dominion over death and the tomb. He reappeared in resurrection glory, thereby comforting, strengthening, and redeeming humanity with the priceless promise and gift of eternal life.

What was the key to Jesus’ resurrection? Was it not revealed in his prayer in Gethsemane? There he subdued human will and submitted to the Divine Plan: “Father, if thou be willing, remove this cup from me: nevertheless, not my will, but thine, be done” (Luke 22:42). What a great lesson for us all: In meekness there is might.

Let us celebrate the might and majesty of our Lord Jesus Christ, not just at Easter, but every day. Praise be to the risen Savior!

Happy Easter, everyone.     *

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Barry MacDonald

Editor & Publisher of the St. Croix Review.

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