is a depth of understanding within the modern Republican Party of what this plan does. When I was first speaking with Congressman Ryan about his plan, I asked, ‘Do you want me to help to get co-sponsors?’ Normally, a congressman wishes to have many co-sponsors to show support and strength. Instead Ryan said, and I paraphrase, ‘No, I’m not going to let anyone co-sponsor the Ryan budget plan until I am convinced they understand it, so that when they talk to the press, they articulate it correctly; they don’t misstate what’s in it or say things that might come back to hurt the plan. I want them to be serious advocates and apostles for the plan.’ And he did that.
Again, early in 2013, I called Congressman Ryan and said: ‘You know, Hernando De Soto would like to come by and visit you to talk about some of the work he’s doing on property rights in Tunisia and some other countries.’ Ryan said: ‘Oh, that would be great. I’m a big fan of his work. Let’s get together in two and a half months.’ I said, ‘That long? He just needs half an hour.’ Congressman Ryan said: ‘At the moment, I am meeting with every member of the Republican caucus to work through this budget; the update of the last one, so that they have a full understanding of what is in the budget.’ He is talking in detail about the changes from last year to this year. That is the depth of knowledge about the plan. So, when we talk about Republicans taking the Senate and the presidency we know what they will do.
This is not wishful thinking. The Republican vision for saving the economy and American liberty is the Ryan plan. It is written down. Every member of Congress gets yelled at about it by folks from the left; they get asked about it by the press. They can competently defend it and articulate it, which I think is extremely important.
The role of inter-state competition in widening the ‘leave us alone’ coalition
So that’s the national level; that’s the future in the United States. We are on the road to serfdom. We do the U-turn when we have a Republican majority in the House of Representatives and a Republican Senate – where we need just 51 votes to cut spending, not 60 – and a Republican president to sign the bills.
When and how do we do that? There are 25 red states with a Republican governor, Republican House and Republican Senate: 165 million Americans live in states with complete Republican control of the state government. This, by the way, is after the 2012 election, when, if you read The New York Times, the modern Republican Party ceased to exist. Then there are 13 states where the Democrats have complete control: California, Illinois and Vermont, for example. They have 81 million people.
So a quarter of the country lives in Democrat states; more than half in Republican states, and the rest have split governance between the governorship, House and Senate at state level. These are the people who redistricted congress between 2010 and 2012. So every 10 years, we redraw the lines both at the state legislative level and in Congress. When you look at who controls state legislatures, the states which have Republican legislatures voted to write the rules for the next ten years to keep themselves in power and the Democrat states did the same thing there. So these states are going to be pretty much the same for around ten years.
You have got 25 basically Republican states and 13 Democrat states, and they are moving in dramatically different directions. Just in the last two years, you see the Democrat states raising taxes so as to not have to reform state pensions. On the other hand, you are seeing Republican states such as Utah reform their state pension system. In Utah, starting a year ago, everybody who is hired as a teacher, policeman, state worker, county, local government worker and so on will have a 401(k) pension plan – an individual retirement account rather than the promise of an unfunded state pension from the government. Utah says: ‘Here is your pay; here is 10 per cent of your pay that goes into your individual savings account. That is our full contribution to your pension.’ This is how we end the creation of unfunded liabilities. Other red states are following Utah in moving to a defined contribution model and away from a defined benefit system that leads to politically driven overpromising. In Democrat Illinois and California they decided to raise taxes instead of undertake reforms.
Changing the demographics
For the next ten years America will have a Republican House thanks to the marvels of redistricting. They have a good shot at winning the Senate over the next several election cycles and we have two presidential elections: 2016 and 2020. I believe that the Republicans will capture the Senate and the presidency either in 2016 or in 2020. Then the Ryan plan will be implemented and we will have done the U-turn on the road to serfdom, and we will be heading in the right direction again. To turn us back, the Democrats would have to take everything and hold it for a while, which I think unlikely.
Now, what do we do? Do we just sit and wait for victory to arrive? No, and that is where the progress at the state level is very important. There has been a lot of discussion about demographic changes in the United States. When Democrats talk about demographics, they just mean race and ethnicity. They are not thinking about vote-moving issues. They think everybody is voting and always will vote based on their race and ethnicity. When Bertolt Brecht, the left-of-centre playwright, was trying to explain what happened in 1953 when the East German workers were revolting against the party of the workers (the Communists) he announced that what they needed to do in East Germany was elect a new people. It couldn’t be the government’s fault; we needed new people.
Well, in point of fact, we can elect a new people. You elect a new people by changing laws to move people from the ‘takings coalition’ that has an interest in expanding the state and helping them see that their interests lie in the ‘leave us alone’ coalition. Where that is happening now, and will continue to happen over the next few decades, is at the state level. I will give you a few examples, starting with the laws that allow home-schooling.
There are two million parents who home-school. Those people are solidly pro-freedom. The government has offered to help babysit their kids for free for 12 years, and they have said, ‘Thanks, but we’ll do it.’ Not only are they winning all of the spelling bees as a result of home-schooling, they are a highly active and aware part of the movement for liberty. Only 30 years ago the government was putting people in prison for home-schooling: it was illegal in all states. That has now been changed.
The voucher movement – the school choice movement – is also important. We now have three states that have dramatically increased the number of vouchers or scholarships available for lower-income students to attend government, private or parochial schools. Today there are 300,000 people eligible for a $5,000 voucher in Arizona alone, 500,000 in Indiana and 500,000 in Louisiana.
So you now have a mass voucher experiment for parents who are told: ‘Here is a $5,000 scholarship for your child each year.’ I particularly like Arizona because the deal is: ‘Here is your $5,000. If you only spend $4,000, you can put the $1,000 into an education savings account, which you can use in future years and which accumulates and grows as you move forward.’ So a parent has $5,000 dollars, per child, and they walk around and say to the local government school: ‘Here’s what I’m interested in, and if you meet my child’s needs you get the $5,000 or I could take that $5,000 to a private school or a charter school, or I could home-school and I get to keep the money.’
All of a sudden, they have the attention of the government school system, as well as of the private schools that exist already, and others that are being created. You have a different human being when they carry that kind of power with them. Before, if you were to complain to the government school, they told you to go away. They considered parents an annoyance. This changes with a voucher or scholarship system and this also changes the nature of the person who carries the voucher.
The Second Amendment issue is also important. In the United States, as I have noted, we now have 4 million members of the National Rifle Association. We have about 18 million hunters, but every year there are fewer hunters. It is dropping by as much as 25 per cent each generation as there
