1) Keep Draining the Swamp

This morning’s BLS jobs report confirms that federal government employment is falling under Trump, while private payrolls continue to expand, albeit at a slower pace.

This is a reversal of trend. Under Biden, a big portion of job creation was in government and government-funded industries.  

Federal payrolls have fallen to the lowest level in more than a decade—substantially lower than at any point in the first Trump term.

When Trump took office, government at all levels accounted for the second largest annual increase in jobs. Today, it’s the largest decline of any sector:

2) The "Vedder Gold Card"

You all know it as the Trump Gold Card, but DJT sort of stole this idea from UP senior fellow and Ohio University economist, Richard Vedder.  Vedder originally floated this idea of auctioning visas to attract the highest talent some 30 years ago and, along with notables like Nobel economics laureate Gary Becker, has been pitching the idea to Congress and presidents ever since.

Finally, in Trump, he found a willing buyer and… voila: The Trump Gold Card.

The idea of the Trump plan is to offer visas for those willing to pay an entry fee of $1 million and gain access to the most treasured asset in the world: a U.S. passport. Trump boasts that under the plan "cardholders will receive U.S. residency in record time."

Vedder says:

"My idea was to cut the budget deficit in half by using the market - not waiting lines and politics - to distribute visas. The most talented people who will create jobs and businesses pay America to move to the front of the line."

We can still issue other visas for refugees, spouses, seasonal workers, and H-1B brainiacs.

By the way, here is the math: if we issue one million Trump Visas a year we will raise $1 trillion A YEAR, not counting the taxes these new arrivals will pay each year.

3) Why Health Care Costs Are Going To Keep Skyrocketing

A HOTLINE reader recently sent us a classic oldie-but-goody economics lesson from economic scholar Mark Perry. Given all the chaos in Washington over Obamacare and the runaway train of health care costs, we thought we'd recite Perry's timeless message.

It looks like Congress has chosen the worst of all options: offering more medical services to patients essentially for "free."  

That wasn't always the case. Perry shows that in 1960, half of medical costs were paid by the patient and today it is less than 10% with many Obamacare subsidies offered for free - I.e., no co-pays required!

If you put a free candy jar in front of a bunch of 4th grade kids, it's a guarantee the basket will be empty by the end of the day.

What Perry has also discovered is that the less patients pay for health services, the more the cost rises.  So plastic surgery, breast implants, lasik eye-surgery (for cosmetic reasons), and most other procedures NOT covered by insurance or Medicare/Medicaid have been level or fallen in price. Over that same time insurance or taxpayer-covered medical services doubled and tripled in price.

So wouldn't you know it: the confederacy of dunces in Congress - led by Chuck Schumer - have chosen to expand Obamacare insurance subsidies to people making as much as half a million dollars a year. Congrats Congress: you've managed to stumble on the worst possible option to control costs.

4) Education: The Lowest Productivity Sector in America

Speaking of Richard Vedder, he used to say that the only profession that has had less productivity improvement over the past half-century than education is prostitution. And new evidence suggests that he may be wrong about that.

Exhibit A is the Los Angeles Unified School District, which is the nation's second largest, with more than 1,000 schools and a budget of nearly $20 billion.

A third of its students drop out without graduating from high school.  Over 72% of students fail math tests, and over 58% fail English.

Over the last dozen years, the schools have seen the number of staffers and their budgets soar while the number of students has plummeted.      

The national picture isn’t much better. Student enrollment dropped during the school lockdowns and has flatlined since - while hiring has surged by over 600,000 K-12 employees over a decade. Can anybody explain what all these added people are accomplishing?  

You can see the numbers for every state and many individual districts at the Georgetown Edunomics website here. This is negative productivity. Public Schools are jobs programs not educational institutions.  

5) $20 Billion Down the Drain

Regular readers of the HOTLINE know that we saw this headline coming 100 miles away:

If you want to wreck an industry, have the government subsidize it.

Ford, which has lost $13 billion on its EV business since 2023, said it would bolster its lineup of gas-powered vehicles...

"Instead of plowing billions into the future knowing these large EVs will never make money, we are pivoting," Ford Chief Executive Jim Farley said in an interview. "We now know enough about the U.S. market where we have a lot more certainty in this second inning" of reduced-emissions powertrains, he said...

The company will stop making an EV version of its F-150 pickup truck, called the Lightning, and will instead make an extended-range version of the truck.

These were just the losses to the car companies. This doesn’t count the hundreds of billions taxpayers spent on the green new deal scam that tried to force families to buy these cars. Thank you, Joe Biden.  

Do you think Congress will learn the lesson that the best way to bankrupt an industry is to subsidize it?

Nah.

6) You Can’t Build Anything in California

NOTE: We appreciate the many constructive comments on yesterday's deportations item and especially the readers who pointed out we had the last couple of sentences out of order. It has been corrected on our website.

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