1) Why Is A $4 Trillion Tax Increase Good News?

The latest projections by the admittedly unreliable Congressional Budget Office are that Trump's tariffs will raise nearly $4 trillion over 10 years.

Giddy Republicans have rushed to the airways boasting about all this flood of tax revenues they are going to bring into the Treasury.

We're confused. Tariffs are taxes. Since when are the Republicans the party celebrating tax increases?

We supported the idea of tariffs as a bargaining tool to negotiate LOWER tariffs unfairly imposed on American goods and services - ranging from tech services, to manufacturing, to dairy and agricultural products. We didn't think that one of the objectives was to squeeze more taxes at the cash register from American consumers.  

Republicans have boasted of the taxes that Americans will save from the Big Beautiful tax cut. Now they boast of a tariff tax increase of about the same size, via tariffs?

That's bad news for the economy and even worse news for the conservative brand. So what are they gloating about? At least if this is the plan, they should reduce other tax rates across the board.  

2) Can We Trust These People With Our Money?

Cost overruns are pretty routine when it comes to Washington projects, and "underbudget" is seldom a word ever spoken. But what has gone on at the Fed with its runaway building cost escalation is fiscal malfeasance and borders on financial fraud.

The spruced up Federal Reserve's Eccles and East buildings were supposed to cost $1.9 billion when the renovation started in 2021. Even that hefty price tag raised a lot of eyebrows in Washington.

Here we are four years later and the cost keeps escalating, now north of $2.5 billion - and this is on top of the recently completed renovation of the Fed's Martin building, which was budgeted at $500 million and ended up topping $650 million.

As President Trump pointed out when he toured the site last month, beautifying the three-building complex now known as the Taj Majal of Constitution Avenue, will cost at least $3.15 billion.

Good going, Chairman Powell. Way to keep your eye on the ball. Trump was right when he said he could have done the remodeling for about $2.9 billion less.  

Why the 30% extra cost? This new price tag, federal documents explain, "reflects significant increases in raw materials costs which far exceed standard cost escalations, higher labor costs, and changes in construction schedule expectations."

Inflated costs of raw materials!  Gee, we wonder who caused that!  

3) Save the Endangered Pianos...from the Radical Environmentalists

Kirk Dahlstrom moved to Alaska and rescued a failing sawmill there in the 1990s when the federal government crippled the timber industry in his native Washington State to protect the Spotted Owl. (Spotted Owl numbers continued to decline anyway - now steely-eyed environmentalists hunt the "bad" Barred Owls to save the noble Spotted Owls they have been outcompeting. True story.)

Dahlstrom, now CEO of Viking Lumber, is fighting the federal government again in Alaska, where he says the Forest Service is out of compliance with its own resource management plan, imperiling the supply of wood needed for Steinway pianos, NASA wind tunnels, and various boats, airplanes, and helicopters.

Dahlstrom's daughter, Sarah Lehnert, writes in the Wall Street Journal:

In 1994, my dad, uncles, their lifelong friend and my grandfather took a gamble on a bankrupt sawmill on Prince of Wales Island in Southeast Alaska. My dad moved our family to rural Alaska, sight unseen, 31 years ago... Today, our wood goes into instruments from Martin and Gibson Guitars as well as Kawai, Boston, Essex, Yamaha and Steinway & Sons pianos. Our company, Viking Lumber, is the last remaining mill in the U.S. able to provide the wood needed for a Steinway piano.

You depend on our wood even if you don't play an instrument. Our Sitka spruce is used in National Aeronautics and Space Administration wind tunnels, in boat and airplane construction, to make the blades of helicopters that fight fires and deliver supplies to troops, and in the nose cones of U.S. military missiles...

In our part of Alaska, the federal government owns approximately 94% of the land and controls access to timber resources. In 2016 the U.S. Department of Agriculture created a management plan that promised the availability of old-growth timber from the Tongass annually on a fixed schedule. The government hasn't exactly stuck to that schedule... in the past four years it offered less than 10% of the annual needs for the industry...

Our 31-year operation won't be able to go on. The families who depend on us here will be forced to move. Our sawmill, the leading supplier to musical manufacturing companies in the world, will die.

Viking Lumber is suing the federal government with the help of the Pacific Legal Foundation. But the Trump administration shouldn't need to be sued to recognize we need to "log baby log" just as urgently as we need to drill baby drill and mine baby mine.

4) Is France Heading For An IMF Bailout?

Yesterday, we cited Germany's epic financial woes, and now France is on the brink. Prime Minister Francois Bayrou faces a vote of no confidence in Parliament on September 8. If his government falls, as seems likely, his Finance Minister Eric Lombard says the nation's public debt crisis may force it to seek a humiliating bailout from the International Monetary Fund. This is like the financial equivalent of being put on a respirator during Covid.

Bayrou has just promised tax hikes on the rich. "Tax breaks that mainly benefit the wealthiest families and big groups will be abolished whenever they are considered unjust or useless."

The last thing France needs now is a tax increase. The wealthy in France are endlessly finding ways to deprive the state of the revenue it hopes to get from higher taxes. Often that's by leaving Paris behind.  Meanwhile, a tax hike would only exacerbate the nation's high 7.8% unemployment rate - which is almost double the U.S. rate of 4.2%.

5) Famous Soak the Rich Economist Inadvertently Concedes Tax Cuts Work

A victory lap from UP co-founder Arthur Laffer:

6) They Just Don't Get it

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