The Party of the Worker Is Now the Party of the Bureaucrat

By Claire Lehmann

Friday, June 19, 2026

 

Fifteen years ago, I worked for a woman, a Deputy Secretary in the federal Department of Health, who told me something that I have never forgotten. She said that "the federal government just throws money down the toilet."

 

I've remembered that statement for fifteen years. It bothered me at the time, because I knew she was being honest. But after the Budget that was delivered on May 12 of this year, it bothers even more. Taxes on Australian workers keep rising through bracket creep. More taxes have been added to this burden with the scrapping of negative gearing and the scrapping of 50 percent discount to capital gains tax (CGT). Meanwhile the federal government keeps flushing money down the toilet.

 

I understand why many Australians are fed up and are turning towards parties that promise to disrupt the status quo.

 

The title of this talk is "From Waitress, to Public Servant, to Business Owner." I've had all three of these jobs, in that order. Tonight I want to use them to make an argument about where the real fault line in this country lies.

 

For most of this country's political history, the major fault line has been between labour and capital—between workers and the bosses who employ them. That's the fault line that shaped the union movement, and the party that grew out of it. The Australian Labor Party.

 

But that fault line isn’t as clear anymore. I believe that the major political conflict we have isn’t between workers and bosses. And it isn't between the public versus private sector either. The real fault line is between those whose work lifts productivity and those whose work puts a drag on it. Those who lift productivity include the surgeon, the teacher, the tradie, and the founder: anyone whose work makes someone else more likely to produce. One doesn’t even have to be in paid work to be productive. Stay at home mums are some of the most productive people in our society, raising the future human capital of the nation.

 

On the other side of the fault line sits work that exists to administer, monitor, or process the people who are actually doing the producing, often with no clear link back to any outcome at all. Every organisation carries some of that second kind of work. But it’s in government that it's growing the fastest, and where it has the least accountability. Because government is the only part of the economy that gets to write its own cheque and send someone else the bill.

 

Now credit where credit is due. I am not an anti-Labor ideologue. I actually come from Labor family. My grandmother used to cheer on Paul Keating during question time, and when I was at university I gave out how-to-vote cards for Penny Wong in my hometown of Adelaide. I've been the beneficiary of medicare, and our higher education system, all supported by our taxes. And I actually agree with the government's decision to scrap negative gearing and to lift the CGT discount on unproductive assets, namely housing.

 

That being said, the decision to scrap the 50 percent CGT discount on company founders, and implement a minimum tax rate of 30 percent for anyone with a capital gain, no matter how much they earn, strikes me as mad. To compound this, our income tax rates remain some of the highest in the world.

 

All this has led me to conclude that somewhere along the way, something has changed. The Labor Party has gone from being a party of the worker to being the party of the bureaucrat. The same party that purports to defend workers has overseen the highest amount of tax revenue generated from labour in Australia's history. The government collected $349 billion in personal income tax last financial year.

 

The same party that says it wants to promote “equity” hasn't raised the income tax–free threshold, which has been in place since 2012. The same party that purports to stand for the fair go now wants to punish people for trying.

 

I learned what work was from the hospitality industry. My first job was at Hungry Jacks, when I was 14 years old. I was paid $4.62 per hour, and my feet would have blisters by the end of the shift. By nineteen, I was working full-time in one of Adelaide's most popular restaurants, a steakhouse on Gouger Street. I made $500 a week.

 

I loved it. But it was physically demanding work. The pace meant every minute counted—slacking off could have a cascading effect. You were also never separated from the person who owned the place. I used to work alongside my bosses. I wouldn’t have been able to tell you what a profit margin was, but I understood that my bosses were not rich. The whole thing only worked because people were grinding to keep the doors open.

 

I also saw the painful side of business ownership. My last job before I finished my degree was at a small Italian restaurant, run by a French immigrant. He worked so hard keeping that restaurant going. But I learned shortly after I had left, that a person I had worked alongside for years had been quietly stealing from the till. By the time anyone noticed, $100,000 was gone. Not long after that, my old boss closed the restaurant.

 

By the time I learned that this little Italian restaurant had closed, I had moved on from the hospitality industry. By the age of twenty-five, I'd finished my degree, and moved to Canberra. I embarked upon what I thought would be a long career as a public servant. I began work at the Federal Department of Health and Ageing.

 

A quick bit of context, for anyone who's never worked in Canberra: not all departments are the same. Some are leaner than others. And some are genuinely well run.

 

And some of the public servants I worked alongside in Canberra were dedicated, capable people. But the Department of Health has a reputation, even among public servants, as one of the more bloated workforces in Canberra. When I was there it had a staff of 4-5000, today it has a staff of over 7000.

 

Let me give you a glimpse of what life is like for a graduate in the department. On my first rotation, I was reprimanded for writing a ministerial letter too quickly. Two hours was sufficient time to write a letter I thought—one that mostly consisted of copy and pasting boilerplate from other letters—but according to the director of the team, I needed to take a day.

 

Why? Because they had nothing else for me to do. There were no meetings, no policies being drafted, and no conference papers for us to work on. So we had morning tea instead. And afternoon tea. We took long lunches. We did crossword puzzles to keep our brains active, and daily "quizzes" to alleviate the boredom. The Director of the section once sent a ministerial letter back to me asking me to delete a comma. I was excited. Because deleting a comma meant that I had something to do.

 

Sometimes there would be a meeting, or a conference, which meant that it was all hands on deck preparing briefing notes for the Minister, and arranging pens on desks for delegates. But most of the interesting work in the department was done by consultants. I wondered why graduates had been hired in the first place, to work as glorified secretaries if all the substantial work was just being farmed out to private industry. Even with a staff of 7000, most of whom from my observation were massively underemployed, the department still outsourced work.  

 

I wasn't the only one who suffered from this situation in the department. Other graduates would confide in me about their despair. One friend of mine used to cry in the bathroom.

 

At the same time however, there were people in the department actively campaigning for less. I was shocked to find a flyer from the union sitting on my desk one morning, advocating for even better conditions—even though we had flex time, we couldn't be fired, and were having morning teas almost every day. I looked at the flyers and thought: how much more comfortable could this possibly get?

 

I should clarify here: it is technically possible to get fired in the federal public service. But the process can take about 12 months, and there is very little incentive to initiate such action. It is much easier to just redeploy an underperformer into another team. And that is what happens over and over again.

 

One woman I worked with on one of my rotations was functionally incapable. She had been at the level of APS 5 for thirty years (as a graduate I was on APS4). She was unable to do a Google search for work purposes, and unable to file documents in alphabetical order. She sat at her desk researching properties online all day. She was paid, in 2011, $65,000 per year. ($94,000 today).

 

For someone who had come from my work background, in busy restaurants, this all felt like a slap in the face. If this is what white collar work is like then this whole thing is a scam, I thought.

 

The budgeting was its own kind of madness. There was an open, acknowledged habit of overspending on purpose—spend the whole allocation every year, whether you needed to or not, because if you didn't spend it, you'd lose it the following year. It's the opposite of every incentive that exists in the private sector, where underspending is the whole point.

 

That's the context for the sentence I opened with tonight. That Deputy Secretary—one of the most senior people in the department told me, matter of factly, that the federal government just throws money down the toilet. It wasn’t a secret. We all knew we were wasting time, and wasting money. So I quit. I felt ashamed participating in what I considered an abuse of the Australian taxpayer.

 

At the time I didn't have the words to describe what I had seen at the Department of Health in economic terms. But it does have a name. Economists call it the free-rider problem.

 

Picture a sharehouse where shared cleaning responsibilities are never enforced. There's always someone who does the dishes, and always someone who just "forgets." If a shared responsibility is never enforced, then the person who is forgetting never bears any cost. The kitchen still gets cleaned, because someone else always ends up doing it for them.

 

Now extrapolate that idea out to an entire department, where nobody can be fired, where overspending is rewarded, and where the people footing the bill—you and I, the Australian taxpayers—have no choice about whether to pay, and no say in how the money is spent.

 

That was one department, fifteen years ago. Multiply it across the whole of government, and you get the budget that was handed down a few weeks ago. Everything I've described to you tonight is about to get a whole lot worse, from both directions: the unproductive side getting bigger, and the productive side getting taxed harder for trying.

 

Since 2022, the APS has grown by 26 per cent. The cost of running it has blown out by 42 per cent—to $114.6 billion, or roughly $8,200 for every taxpayer in this country, every year. Budget papers show that figure being revised up by a further $19.6 billion over the next four years—on its own, enough to wipe out any savings from cutting the NDIS. Government spending overall now sits at 28 per cent of GDP—the highest it's been in my lifetime.

 

But here's what I find most telling: of all the things this budget reformed, the government's own spending wasn't one of them. There was no plan to shrink the size of government, no serious attempt to ask why the APS needs to keep growing so fast. Every other part of the economy was asked to adjust. The one part of the economy that gets to write its own cheque was not.

 

A few weeks ago, the Secretary of the Treasury, Jenny Wilkinson, gave the post-Budget address to the Australian Business Economists. It's worth paying attention to what she chose to talk about, because it tells you something about how this budget was actually built. Her speech was thorough, and serious, and almost entirely about one thing: who has more wealth, and who should have less. Page after page of analysis on lifetime income distribution, effective tax rates by income bracket, who benefits from negative gearing and trusts and by how much. All of it very carefully modelled.

 

But all of the modelling was based on the assumption that wealth just naturally manifests itself.

 

The Treasury Secretary did not model how these tax changes might affect the decision to start a business at all, to take the risk, to build the very thing that gets redistributed in the first place. When she did address the risk question directly, her answer was that the research didn’t support the idea that capital gains tax impacts risk-taking, beyond compensating for inflation. She mentioned one citation, and moved on. The Treasury, by its own admission elsewhere, hasn't modelled the productivity impact of these reforms at all. You can build a very rigorous case for redistribution. It's a different exercise entirely to build a case for growth, and that is what Treasury has not done.

 

Australia is already a hard place to take risks, and it's getting harder. The OECD's latest survey found that Australia has gone from being one of the five easiest countries in the OECD to start a business in the late 1990s, to below the OECD average today. The rate of creation of new companies has been falling since the mid-2000s, and its slowing down. And the conversations I've had, particularly with young people online, about the proposed changes have told me something else: there's very little understanding in this country of why entrepreneurship matters, or what risk actually does.

 

Risk is not just about business. An artist starting a new body of work, a scientist researching a brand new theory, a couple deciding to have their first baby—all of these are bets on a future that hasn't happened yet, made by people who don't know how it'll turn out. A scientist doesn't know in advance whether five years of work on an obscure problem will lead anywhere. A film director doesn't know ahead of time if his film will find an audience or flop. A new parent doesn’t know that their expected child will be healthy. They take the risk anyway—and when it pays off, we're all better off because of it.

 

What we don't see is the risk not taken. The research not pursued. The film not made. The business not started. The children that are never born. When people don't take risks, we can't know what future we've missed out on. Those losses are invisible—which is exactly why they're so easy for the government to ignore them. You can't put a line item in a Budget for the company that never existed.

 

So here's where this leaves me. I believe in the social contract—the idea that we put something in, so that we all can get something out that none of us could build alone. A hospital. A school. A road. What I don't believe is that we're currently honouring this contract. As citizens we are putting in more than ever. But we are getting back a public service that refuses to constrain its own growth, and now a Budget that didn't even attempt to try.

 

***

 

So how do we get out of all this? My suggestion for government is this. Reform the Australian Public Service. Managers and directors need the power to fire underperforming workers without a twelve-month process standing in their way. Ask honestly how much of the public service could be cut without affecting a single deliverable—I'd suggest the answer is not trivial. And the incentive to overspend has to be re-assessed: no other part of the economy works this way. If we want to restore some fairness to the worker, we have to be far more responsible with how we spend their hard-earned money.

 

On that note: I agree with Angus Taylor that income tax needs to be indexed to inflation. The top bracket of $180,000 was introduced in 2008. Had it been indexed since then, it would sit closer to $280,000 today. Instead our top tax bracket kicks in at $190,000. Every working Australian would be better off if the brackets moved with inflation. That successive governments have avoided this reform is a generational scandal.

 

And before we raise capital gains tax on business owners—what the economist Richard Holden has called "a productivity tax during a productivity crisis"—there are other ways to deal with housing affordability that don't require punishing risk. Reducing immigration. Taxing unproductive land. Plenty of credible economists have already mapped out ways to increase housing supply. None of it is exotic. All of it has been sitting on the shelf, waiting for a government willing to do something harder than redistribute what already exists.

 

***

 

Finally, tonight, I want to finish by speaking to the risk-takers in this room.

 

I've noticed, in the past few weeks, a resurgence of something pernicious that can sometimes characterise this country: tall poppy syndrome.

 

I've seen ordinary Australians, who own a modest amount of shares, likened to robber barons. I've seen small business owners described as being "subsidised" by the current tax settings.

 

This is an inversion of the truth. Everyday Australians investing in shares are doing the right thing, and should be rewarded for it, not punished for their thrift. People who take the risk to start a business are not subsidised by our tax settings—they pay income tax, company tax, payroll tax, and GST. When a capital gain finally occurs, it's on money that has already been taxed. This is no subsidy in the equation.

 

We should also remember something this country seems to have forgotten: in a free market, a business only succeeds when it gives customers something better, or cheaper, than the alternative. The value captured by the business owner is only ever a small fraction of the value created for everyone else.

 

The future is built by the saver who buys shares instead of another holiday. The tradie who decides to start a business and hire apprentices. The founder who pays himself $80,000 a year, the surgeon, the teacher, the parent who took the risk of bringing a child into the world.

 

Long live every Australian still willing to build something nobody asked them to build. They are not the burden this country needs to manage. They are the only thing that has ever paid for everything else.

In California, the Damage of the ‘Billionaire Tax’ Has Already Been Done

By Charles C. W. Cooke

Thursday, June 18, 2026

 

“A proposal to tax the wealth of billionaires in California,” the New York Times reports, “has officially gathered enough signatures to appear on the November ballot.” And yet: “It isn’t yet certain that the tax initiative will actually be voted on.” Why? Because “several prominent Californians, including Gov. Gavin Newsom, have vowed to defeat the measure, and they could strike a last-minute deal to remove it from voter consideration.”

 

Yeah, maybe. But, at this point, who cares? This one is already over. Maybe the referendum will pass. Maybe it’ll be struck from the ballot. Maybe it’ll be nixed in exchange for some other venal priority of the SEIU. Maybe half of the state’s voters will be abducted by extraterrestrials. It doesn’t especially matter. At this stage, there remains no outcome that isn’t bad for California and for the Democrats that run it. The damage has been done.

 

Merely by talking about a wealth tax, California prompted an exodus. Prophylactically, a series of entrepreneurs, worth between $700 billion and $1 trillion, summarily left the state. What happens next remains to be seen, but none of it is salutary. Back of the envelope, the options appear to me to be as follows:

 

1.      The measure is removed from the ballot at the behest of Gavin Newsom—who, in his characteristically egotistical way, has said, “I’ll do what I have to do to protect the state”—and an internecine fight breaks out within the Democratic Party, which further emboldens the anti-establishment wing that has recent brought us such luminaries as Zohran Mamdani, Graham Platner, and Alexandria Ocasio-Cortez.

 

2.      The measure is removed from the ballot as part of a grand bargain that further solidifies union control of California, and thereby guarantees that the state is treated to even more of the anti-growth policies that have been bleeding the state dry for decades.

 

3.      The tax remains on the ballot and passes, at which point those who have already fled will be joined by a good number of others who will now be leaving to avoid a real, rather than a theoretical, confiscation of their assets. In all likelihood, those people will go to Austin, Texas, or to Miami, Florida, or perhaps even to New York City.

 

4.      The tax remains on the ballot but doesn’t pass, at which point the institutional Left in California will have to acknowledge that it chased out up to a trillion dollars of wealth — and the existing activity and tax revenues that it generates — in pursuit of an idea that was so unpopular that it was rejected by one of the most progressive electorates in the nation.

 

Pick your outcome. It doesn’t matter. In every scenario, California gets hosed.

 

Why has this happened? There are many reasons, but one of them is that the state’s residents have become all too comfortable having it both ways. Californians want to rely upon the rich to pay almost all of the taxes in the state and to vilify those rich people and to suggest that they shouldn’t exist. By design, California’s budget is heavily reliant upon the wealthy. This is why California collects far more revenue than usual during tech booms and periods of impressive market gains, while during busts and downturns it faces drastic budget deficits. Under the current system, the top one percent of Californians pay around half of all personal income taxes in the state, while the top five percent pay around 70 percent. And unlike in the federal tax code, capital gains are treated as ordinary income in California, which means that when a founder sells his company or an investor realizes his gains, he is taxed at the full rate. The Democrats who run the state insist that this is “fair,” which is their prerogative. But when combined with their open hostility toward those who are paying the bills, it is unsustainable.

 

A few years ago, the head of the California Federation of Labor Unions, Lorena Gonzalez Fletcher, tweeted “F*ck Elon Musk.” In response, Musk wrote “Message received” and relocated Tesla to Texas. While less profane, the “billionaire tax” has sent the same message, and, whatever its fate, it is now guaranteed to have had the same results.

In California, Organized Labor Might Just Defeat Itself

By Will Swaim

Thursday, June 18, 2026

 

An SEIU-backed measure to tax the global assets of California’s roughly 200 billionaires may be the rare progressive tax proposal defeated not by corporate money but by organized labor itself.

 

That’s the assessment on Polymarket, where, as of Wednesday, 64 percent of bettors predict the union-backed initiative won’t make it to the November ballot. They’re betting that the measure’s backers, Service Employees International Union–United Healthcare Workers West (SEIU-UHW), will withdraw their “2026 Billionaire Tax Act” before the June 25 filing deadline.

 

The assumptions come from a rumored compromise that SEIU-UHW insists won’t happen. The union notes it gathered more than 1.5 million signatures to qualify the initiative — far above the roughly 875,000 valid signatures required. It also boasts support from Senator Bernie Sanders and Robert Reich, the former Clinton labor secretary and University of California professor. Supporters say the one-time tax — which they predict will capture about $110 billion — is necessary to backfill cuts in the rate of growth of federal Medicaid funding.

 

But SEIU’s biggest challenge isn’t signature-gathering. It isn’t a lack of progressive allies. It isn’t even the prospect of an opposition campaign funded by the targets of the wealth tax, California’s richest residents.

 

The biggest threat to the wealth tax is organized labor.

 

Leading the opposition is Governor Gavin Newsom, who has spent months assembling an unlikely coalition against one of labor’s own proposals. His antipathy for wealth taxes (he killed a 2022 legislative attempt by merely signaling his disapproval) is rooted in a longstanding California fiscal problem: The state relies heavily on a relatively small number of affluent taxpayers whose incomes are tied to volatile capital gains. An oft-cited Legislative Analyst’s Office report warns the top 1 percent of California’s wealthiest residents pay nearly half the state’s income tax. Because capital is mobile, those taxpayers won’t necessarily wait to see whether the measure passes. The Hoover Institution notes that mere rumors of the impending wealth tax were enough to prompt several billionaires to hit the eject button: director Steven Spielberg (who reportedly established residency in New York City); PayPal co-founder Peter Thiel (Miami); Google co-founders Larry Page (Miami) and Sergey Brin (reportedly Nevada); venture capitalist David Sacks (Austin); and auto-finance billionaire Don Hankey (Las Vegas). And though SEIU included him in its calculation of billionaire wealth in California, Oracle co-founder Larry Ellison left California for Hawaii in 2012.

 

Cataloging the chaos, researchers at Hoover concluded that, after accounting for taxpayer flight and implementation challenges, the measure would actually leave California $25 billion poorer.

 

Newsom saw it all.

 

“The evidence is in,” he told Politico in January. “The impacts are very real — not just substantive economic impacts in terms of the revenue, but start-ups, the indirect impacts of . . . people questioning long-term commitments, medium-term commitments. That’s not what we need right now, at a time of so much uncertainty. Quite the contrary.”

 

“This will be defeated — there’s no question in my mind,” Newsom told the New York Times that same month. “I’ll do what I have to do to protect the state.”

 

Now, Politico reports, Newsom is rallying labor unions representing teachers, police, construction workers, and carpenters, along with such prominent health-care organizations as Planned Parenthood, to join him.

 

The most striking defection came from the California Teachers Association. For decades, CTA has championed higher taxes on wealthy Californians. Early this month, the union voted to oppose the SEIU wealth-tax initiative, arguing that it would tank the state’s general fund on which public education gets a constitutionally guaranteed 40 percent.

 

That vote revealed the real conflict. This isn’t primarily a fight over whether billionaires should pay more taxes. It’s a fight about whether the Atlas Shrugging of California’s billionaires will destroy an economy — and a tax system — on which multiple parties depend.

 

But whatever the merits of those policy arguments, the initiative’s political problem is even more immediate: Powerful unions appear increasingly unwilling to support it.

 

Insiders say Newsom’s campaign to kill the measure before the June 25 deadline is more carrot than stick. He’s threatening to kick SEIU-UHW President Dave Regan off Good Time Island.

 

“Dave Regan is seeing very plainly what he’ll be up against if he goes through with this,” a Newsom consultant told Politico.

 

Regan expected — was indeed counting on — opposition from billionaires: The image of wealthy Californians financing attacks on a tax-the-rich initiative would fit neatly into the union’s political messaging.

 

But that strategy becomes far more difficult when opposition ads include teachers, police officers, construction workers, health-care organizations, and a Democratic governor.

 

One of SEIU’s few union allies, Unite Here Local 11 leader Kurt Petersen, says bring it on.

 

“This is the fight we want,” Petersen told Politico. “We’re at war. People need to decide which side they’re on.”

 

Some have already made that decision. San Francisco voters in June rejected that city’s “overpaid CEO tax” despite the support of every local labor union. And pre-campaign polling for the wealth tax is an anemic 52 percent.

 

Meanwhile, back on Polymarket, 82 percent of bettors predict that if Team Newsom fails — if the wealth tax reaches the November ballot — California voters will reject it.

The Blue-State Delusion Over Unions

By Nicholas Bagley

Thursday, May 28, 2026

 

What are public-sector unions for, exactly? What problem are they supposed to solve? That’s the question I found myself asking earlier this month, when the best-paid railroad workers in America went on strike for three days.

 

To be clear, I get what the unions understand their purpose to be. It’s to get the best deal for their members. That’s what they’re designed to do, and they do it well.

 

Salaries at the Long Island Rail Road—a commuter-train system that connects suburban residents to New York City—now average $121,646, which is 50 percent more than the median household income in New York City ($80,483). Work rules entitle engineers to double or even triple pay when they drive different types of trains on the same day or when they deliver a train to the maintenance yard after driving passengers. Last year, more than 300 LIRR workers each earned $100,000 in overtime—in addition to their base pay. Those extra wages in turn inflate their pensions, which they can take at the age of 55 after 30 years of service.

 

All of this is as good for union members as it is unimaginable for most American workers. But taxpayers and commuters are the ones who pay for those generous compensation packages, and it’s reasonable to wonder whether they are getting a fair deal.

 

To her credit, Governor Kathy Hochul pushed back on the LIRR unions. But she quickly settled the strike on still-to-be-disclosed terms that will keep in place massive overtime payments, expensive work rules, and bloated pensions. That’s business as usual in blue states and blue cities, where public-sector unions wield fearsome political power.

 

None of this is inevitable. Strong unions persist because roughly 30 states have passed laws requiring collective bargaining with public workers. If this process advanced the common good, all would be well. But the available research suggests that it doesn’t. To the contrary, unions routinely insist on pay packages and work rules that degrade the efficiency and effectiveness of the public sector.

 

Our laws aren’t doing a good job, in short, of aligning union incentives with the public interest. That’s a big problem, especially as our most vibrant cities struggle to provide good schools, effective policing, and high-quality transit. Reform is long overdue. Thankfully, it’s also achievable.

 

***

 

For many union members, it’s completely obvious why we have collective-bargaining laws. “The training process for this job is over a year long,” explained one LIRR engineer on the picket line. “It consists of multiple examinations. Some of the written ones are incredibly difficult. We are very qualified. And, you know, frankly we deserve this money.”

 

We deserve this money. What should the public make of this argument?

 

In a market economy, compensation isn’t normally keyed to what a worker deserves in the abstract. It’s linked, instead, to what an employer has to pay to attract high-quality workers. An employer that pays too little will find itself with too few workers or workers who are bad at their jobs. An employer that pays too much risks being driven out of business by more cost-conscious rivals.

 

There’s nothing intrinsically fair about the resulting wage distribution. Because, from an employer’s perspective, the goal isn’t fairness. It’s running a successful business.

 

In the private sector, unions temper that unfairness by pushing corporate owners to split profits with workers. But private-sector unions can push only so hard: If they insist on compensation packages and work rules that make the business go bust, they could find themselves out of a job.

 

Matters are different in the public sector. The Long Island Rail Road, for example, is owned and operated by the government, much like public schools and police departments. As a result, the unions representing public workers aren’t constrained by the possibility of corporate bankruptcy. They’re constrained instead by politics.

 

Which means that politicians have to decide how to compensate government workers. One approach, favored by unions, is to depart from the baseline set by the market and pay workers what they deserve. It’s an appealing idea. Public workers do crucial work and ought to be compensated fairly for it.

 

The trouble, of course, is that there’s no end to claims about deservingness. Pretty much everyone thinks they’re underpaid and underappreciated. Sometimes they’re right; sometimes they’re not. But I don’t know what a teacher or a cop or a railroad engineer “deserves,” nor does anyone else.

 

Giving public-sector workers what they think they deserve, moreover, clashes with how everyone else in the economy gets paid. Is it fair for one group to get special consideration just because they happen to work for the government? Especially when taxpayers—working people themselves—are picking up the tab?

 

During negotiations with the railroad union, Hochul suggested that the answer is no: “Workers deserve to be paid fairly for their work,” she said. “But at the same time, we must be responsible with public funds and the fares paid by Long Island residents.”

 

That’s the right approach. When the government supplies public services, its goal should be to supply those public services as efficiently as possible—not run a tax-and-transfer system to aid the relatively small number of people lucky enough to be union members.

 

***

 

There is a better argument for public-sector unions, which is that unions have the leverage to demand compensation packages and work rules that are necessary to attract excellent public workers. Here’s Randi Weingarten, the long-standing head of the American Federation of Teachers: “If we want to recruit and retain high-quality teachers, it starts with a fair wage, adequate working conditions, and the resources and support to succeed.”

 

There’s a lot to this. The public sector, like the private sector, is only as good as its workforce. If unions help attract better teachers and cops, collective bargaining might improve the quality of public services. We should be happy, on this view, that unions are fighting for government workers. We’re all better off as a result.

 

Except that’s not what the research shows.

 

Start with schools. Two comprehensive reviews of the available evidence, one from 2025 and one from 2015, find that teachers’ unions reliably increase school spending, especially on salaries for veteran teachers. In general, however, they do not appear to help kids. “Most often,” the 2025 review says, “teachers’ unions have no impact or a slight negative impact on performance.”

 

Recent experience in Wisconsin is revealing. In 2011, Republicans passed a law, Act 10, that curtailed collective-bargaining rights for teachers. In the immediate aftermath, student outcomes suffered, mainly because of a sharp increase in teacher turnover. But that dip was short-lived.

 

Since then, a series of studies have suggested that Act 10 has improved student performance. Barbara Biasi, an economics professor at Yale, found that test scores rose when districts ditched seniority-based pay in favor of a more flexible approach. Morgan Foy of the University of Illinois found similar gains in test scores and attendance even in districts that didn’t adopt a flexible pay scale—because, he suspects, teachers worked harder when unions couldn’t protect them from discipline. And E. Jason Baron at Duke has shown that the promise of higher entry-level wages enticed more young Wisconsinites to get a teaching degree, which has improved the talent pool.

 

Now consider policing. In 2003, sheriffs’ deputies in Florida secured collective-bargaining rights because of an unanticipated court decision. Researchers at the University of Chicago Law School took advantage of that natural experiment by comparing sheriffs’ offices with municipal police departments that were unaffected by the court decision. Collective bargaining, they found, caused a roughly 40 percent increase in violent misconduct in sheriffs’ offices relative to police departments.

 

That’s the opposite of what you’d expect to see if public-sector unions made public services better. But it’s consistent with the general run of the evidence about policing. One forthcoming study, for example, finds that the extension of collective-bargaining rights significantly increased the number of civilians killed by police, especially nonwhite civilians, and “can explain 14 percent of all non-white civilian deaths by legal intervention between 1959 and 1988.”

 

To put it mildly, these results are hard to square with the claim that public-sector unions improve the public sector. At least three factors seem to be driving those results.

 

First, unions often push for job protections that frustrate workplace accountability. In the study of Florida sheriffs’ deputies, for example, collective bargaining appeared to cause a rise in violent misconduct, because of “a reduction in expected sanctions.” In other words, sheriffs’ deputies knew they could get away with it.

 

Second, unions push to equalize pay among their members based on seniority and credentials, not on quality of performance. That makes recruiting talented young people difficult, and rewarding good workers impossible. The Wisconsin reforms, for example, “led younger and less credentialed teachers to earn more on average, and older, more experienced teachers to earn less.” That’s bad for aging union members, but good for students.

 

Third, public-sector unions avidly negotiate for compensation in the form of pensions, not wages. But pensions are a poor recruitment tool: Starting wages matter much more to young people than pensions that will be paid out decades down the line. When unions use their power to boost pension payments, they aren’t working to attract talented young people. They’re working to reward their members.

 

***

 

If we want unions that actually improve the quality of public services, we’re going to have to reform our collective-bargaining laws.

 

As matters stand, those laws require state and local governments to negotiate with unions. But they also establish what those unions are entitled to negotiate over—what is “bargainable.” And a very wide range of terms and conditions of employment are typically bargainable. That’s how you get demands for job protections, pay equalization, and hefty pensions.

 

None of that is graven in stone. The laws could be amended to limit the scope of what’s bargainable. Overtime, pensions, work rules, salary schedules—all of those would be off-limits. Unions would be left to negotiate over the one thing that is most likely to attract high-quality workers: base wages.

 

In that world, unions would still be powerful. They would still serve as a counterweight to local governments that might try to balance their budgets on the backs of middle-class workers. Their members would still receive job protections under civil-service laws. The unions just wouldn’t be allowed to make demands that frustrate the delivery of high-quality, cost-effective public services.

 

Reformed collective-bargaining laws would bring what unions want into better alignment with the public interest. Otherwise, we’re left with the LIRR engineer’s argument about what the unions are for: We deserve this money. The engineer may be right about what he deserves. Surely we all deserve better in this fallen world. But it’s no way to run a railroad.

Caution: May Cause Billionaires

By Christian Schneider

Thursday, May 21, 2026

 

In her new book, former Wall Street Journal technology reporter Joanna Stern recounts how, after receiving a breast ultrasound, she sat down with her doctor who had run the images through an AI program used to detect cancer.

 

The Koios DS Breast ultrasound tool found some masses, which it marked as benign. Others it marked suspicious and needing further investigation (spoiler: she is fine). When Stern interviewed the Koios CEO, Chad McClennan, he told her that when the program labels a finding “suspicious,” it will be wrong one-third of the time. But compare that to human radiologists, who are wrong two-thirds of the time.

 

AI can already detect cancers that humans using existing technology cannot, and it’s getting better every day. A study of 100,000 women in Sweden suggested that AI use in breast cancer screenings cut late diagnosis by 12 percent.

 

An AI model that analyzes and predicts cell movement was reportedly able to spot pancreatic cancer three years before doctors reading scans could. Other progress has been shown in detecting other organ diseases, diabetes, high blood pressure, Alzheimer’s, and Parkinson’s.

 

But while AI may lead to cures for disease, progressives around America are more concerned about the byproducts of such innovation. Instead of marveling that we may be on the verge of machines that catch the tumors that would otherwise kill us or our loved ones, they’ve decided the real crisis is that a few rich people are profiting from the data centers that make it possible.

 

The left’s complaint is twofold: The infrastructure is ruining the environment, and billionaires shouldn’t exist.

 

On the first point: Data centers do consume substantial energy and water, but the extent is grossly overstated, sometimes by a factor of 1,000. The U.S. already has well over 3,000 operational data centers, and yet Americans can still drink water and charge their phones.

 

Sure, some of the concerns about AI dependency are legitimate. A study in The Lancet: Gastroenterology and Hepatology (bathroom reading in every household) suggested that endoscopists who relied on AI for detection eventually saw their own diagnostic skills erode.

 

But progressives aren’t sending their best to make the anti-AI case. It is expected that the annual AI medical-diagnostic market will increase from $10 billion in 2026 to nearly $210 billion by 2034, meaning many rich people are spending heavily to make even more money. So in response, what we get from progressives is a performance — an aesthetic of class solidarity that falls apart the moment you look at where the performers are staging it.

 

Take Sarah Paulson, a wealthy actress who wore a dollar-bill mask over her eyes to the Met Gala to protest wealthy people. Was the message that the rich are blind? That they’re crass and gauche? Whatever the metaphor was supposed to be, it dissolved into the ambient absurdity of a millionaire at a $100,000-per-ticket party complaining about income inequality to a crowd of millionaires.

 

Or consider the scenes outside Luigi Mangione’s hearing this week, where a cluster of supporters cheered for a man charged with murdering a health-insurance CEO. The Mangione fan club has decided that killing insurance executives is, at minimum, understandable — a conclusion that requires you to believe that the best way to improve Americans’ access to health insurance is to gun down the people running the industry. This is the politics of grievance metastasized into a cruel and sinister ideology, and it found three enthusiasts willing to clap for it in public.

 

Hasan Piker, the progressive streamer, has taken to endorsing what he calls “microlooting” — the stealing of goods from retail stores as a form of economic protest. The theory, insofar as there is one, seems to be that theft hurts corporate owners. The reality, as anyone who has ever worked retail can tell you, is that theft hurts store employees. Hours get cut. Departments get shuttered. The workers Piker claims to champion absorb the loss while the ownership adjusts its insurance premiums.

 

Then there’s Alexandria Ocasio-Cortez, who has argued that no one can honestly earn a billion dollars — that the figure itself is proof of exploitation. “You can’t earn a billion dollars,” the New York congresswoman said on a podcast as the host, fellow midwit Ilana Glazer, cackled along. “You just can’t earn that. You can get market power, you can break rules, you can abuse labor laws, you can pay people less than what they’re worth, but you can’t earn that.”

 

This is a theory she has developed and distributed primarily on social media platforms owned by billionaires. (AOC also used to own a car manufactured by one of those billionaires, in fact the wealthiest man on earth, back when they were fashionable among the climate-obsessed.) The hypocrisy is not subtle.

 

And yet progressives never seem to make the connection. Every AOC video passes through a data center at some point. The angry emails to legislators opposing new AI infrastructure? Also traveling through data centers. The petitions, the Substacks, the fundraising emails, the protest TikToks — all of it depends on the same digital architecture that progressives spend their afternoons denouncing.

 

This brings us to left-wing Wisconsin gubernatorial candidate Francesca Hong, who recently posted on X — which is, once again, owned by the world’s wealthiest man — to sing the praises of socialism. A better encapsulation of the modern progressive dilemma doesn’t exist. As Marshall McLuhan once said, the medium is the message, and the message here is: I oppose the people who built the thing I am currently using to tell you I oppose them.

 

The data-center freakout is especially ridiculous. Every solution to problems presented by data centers will also pass through data centers. Energy-efficient cooling technology, optimization of the grid, reducing resource-consumption: AI is the technology most likely to figure it all out.

 

Of course there are real concerns about AI, not least that as we become dependent on it, our minds may atrophy. But that doesn’t mean billionaires should be prevented from developing it. It’s up to us how we use it.

 

The left has decided that because AI makes some people enormously rich, the technology itself is suspect. It doesn’t occur to them that AI, among its many benefits, could lead to astounding breakthroughs in health care for all of us. The Koios DS program doesn’t care about the politics of its investors. It cares, in the only way a program can care, about the pixels in an ultrasound image. It finds the thing the doctor missed. If technology like that makes a few people billionaires, you’d have to admit they earned it.

All the Money in the World, and Then Some

By Kevin D. Williamson

Monday, May 04, 2026

 

We finally really did it! You maniacs! You blew it up!

 

From the numbers-monkeys over in the statistical department comes the news that U.S. government debt has crossed a red line: Debt held by the public now exceeds 100 percent of GDP, those figures being $31.27 trillion and $31.22 trillion, respectively.

 

What that means is that if the federal government were somehow able to pass a tax that would confiscate 100 percent of the output of the U.S. economy for a year—if consumption somehow magically fell to $0.00 and Americans were able to do nothing else with their economic efforts except put their fruits toward the national debt—it would not be enough.

 

Oh, don’t worry—it gets worse.

 

On top of the $31.3 trillion in federal debt per se, there’s another $88 trillion or so (some estimates are higher) in unfunded liabilities for major entitlements such as Social Security and Medicare. There’s another $1.5 trillion or so in unfunded state and local government pension liabilities, which are not a federal liability as a formal matter, but it is all the same from the taxpayers’ collective point of view, and the pressure for a federal bailout of the states may very well overwhelm our weak-kneed Congress. Call it $120 trillion in the hole just to keep the number simple. That is just a little bit more than the total economic output of the entire human race in 2025. That is a lot of money: In fact, even if you define “money” relatively broadly (here, I’m using M2, meaning all the cash, checking and savings deposits, and smaller instruments such as certificates of deposit) it is—fun fact!—more than all the money in the world.

 

Oh, don’t worry—it gets worse!

 

The Congressional Budget Office adds this cheery context:

 

Deficits

 

In CBO’s projections, the federal budget deficit in fiscal year 2026 is $1.9 trillion and grows to $3.1 trillion by 2036. Relative to the size of the economy, the deficit is 5.8 percent of gross domestic product (GDP) in 2026 and grows to 6.7 percent in 2036, which is greater than the 3.8 percent deficits averaged over the past 50 years. Rising net interest costs drive much of that increase. The primary deficit, which excludes those net interest costs, totals 2.6 percent of GDP this year and stays below that level through 2036, when it totals 2.1 percent.

 

Debt

 

From 2026 to 2036, large and growing deficits cause debt to increase. Federal debt held by the public rises from 101 percent of GDP this year to 120 percent in 2036, surpassing its previous high of 106 percent of GDP in 1946.

 

Outlays and Revenues

 

In CBO’s projections, federal outlays in 2026 total $7.4 trillion, or 23.3 percent of GDP. Relative to the size of the economy, outlays remain near their 2026 level through 2028 and then rise, reaching 24.4 percent of GDP in 2036; that trend is a result of greater spending on Social Security and Medicare and growth in net interest costs that are partly offset by declining outlays for discretionary programs. Revenues total $5.6 trillion, or 17.5 percent of GDP, in 2026. Over the 2026–2036 period, increasing individual income tax receipts and remittances from the Federal Reserve are partly offset by declining customs duties measured in relation to the size of the economy. In 2036, revenues total 17.8 percent of GDP, slightly above their 50-year average of 17.3 percent.

 

The bosses here at The Dispatch have asked me to keep the profanity to a minimum, so I am not going to write in plain English what it is that we are: Let’s just say that it is a problem we have not ducked.

 

If longtime readers will forgive my repetition here, I think it is necessary that we liberate ourselves from the crippling superstitions and anesthetizing lies that almost always accompany the discussion of this issue. A few facts to tattoo on your brain:

 

1.      This debt is not driven by incontinent spending on a selection of boutique federal programs that you and your friends don’t like. The main drivers of our debt are Social Security, Medicare, Medicaid and other medical entitlements, national security, and interest on debt already incurred, the latter being a growing and worrisome burden. At present, Social Security by itself accounts for 22 percent of all federal spending; interest payments are 14 percent; non-Medicare health spending is 14 percent; Medicare is another 14 percent; national defense is 13 percent, low by historical U.S. standards; “income security,” meaning welfare writ large, is 10 percent; veterans’ programs are 6 percent; every other damned thing put together adds up to only 6 percent of federal spending. The 2025 deficit amounted to 26 percent of federal spending, meaning we borrowed a little more than $1 out of every $4 we spent. That means that we could cut Social Security spending in half, cut Medicare spending in half, and cut national-defense spending in half and still not balance the budget.

 

2.      Contrary to what my Republican friends often insist, there is no obvious way out of this without entitlement reform and higher taxes or major defense cuts—very likely, all of the above will be required. We could cut non-defense non-entitlement spending to $0.00 and not be able to balance the budget. There is no balanced budget without major entitlement reform, but entitlement reform on its own will not be sufficient: There will have to be large cuts to defense spending and other programs or a large tax increase. Both Democrats and Republicans in Congress, and the ones who have sought their parties’ respective presidential nominations in recent years, generally oppose such cuts. Republicans generally oppose tax increases, and Donald Trump seems to have successfully dragged the GOP into a position of blanket opposition to entitlement reform, at least where that would concern Social Security and Medicare.

 

3.      Contrary to what my progressive friends so often insist, our debt crisis is not the result of tax cuts, and a return to Eisenhower-era tax rates would not fix the problem—in fact, such a policy would not improve the fiscal situation at all. That is because the federal government collects more in taxes today than it did in the supposed economic golden age of the postwar years: Federal taxes from 1956 to 1960 ran 17 percent, 17.3 percent, 16.8 percent, 15.7 percent, and 17.3 percent of GDP. In 2025, federal taxes amounted to 17.3 percent of GDP, a little bit higher than in the Eisenhower years and higher than the 1950-1970 average. The variation is on the spending side: 1950-1970, federal spending ran 17.6 percent of GDP; in 2025, it was 23 percent of GDP—nearly a third more in GDP terms. Tax collections have stayed the same, edging up only a little, but spending is radically higher.

 

4.      Warmaking isn’t cheap, but all this isn’t really a warmaking burden. In GDP terms, defense spending has been trending downward over the years, while entitlement spending is up sharply. Defense spending was 9 percent of GDP as late as 1962, more than three times the 2025 level of 2.9 percent of GDP. In the same years, Social Security spending more than doubled as a share of GDP, and as late as 1979, Medicare spending was only 1 percent of GDP and had more than trebled to 3.3 percent of GDP by 2025. Means-tested (“welfare”) spending went from 0.7 percent of GDP in 1962 to 1.7 percent of GDP in 2025. The notional surpluses at the turn of the century (1999, 2000, 2001) all involved spending that was under 18 percent of GDP. This isn’t to say that the Republican-backed tax cuts of that era were good policy (I do not think they were) or that they did not make things marginally worse (it certainly seems they did), but the thing that has changed dramatically is spending. The numbers are pretty clear on that. There is no year on record, from the beginning of the federal data set in 1930 to the present, in which federal tax collections would have been sufficient to sustain current spending levels: Even in 1944—while the federal government was funding World War II—taxes just barely topped 20 percent of GDP.

 

If you think I’m being funny with the numbers, please do go see for yourself—this is all easily accessible public information.

 

Oh, don’t worry—it gets worse!

 

While the White House is busy indicting former federal bureaucrats for ... posting pictures of seashells on social media ... we are potentially only one failed Treasury auction away from fiscal apocalypse. I put the word “potentially” in there only because nobody knows what a national fiscal crisis looks like when the country in question is responsible for a quarter of the entire world’s economic output. My guess is that it will not look good, and while it is possible that the sheer scale of the U.S. economy will buy us some leeway, it is equally likely that we already have been extended much of the leeway that we can reasonably expect. Laugh at supposed socialist hellholes like Sweden and Denmark all you like, but those big-spending, high-tax welfare states have debt-to-GDP ratios of 35 percent and 28 percent, respectively. (N.B.: You’ll note some discrepancy here, with U.S. debt listed in the linked table at 123 percent of GDP; that’s because this figure includes so-called interagency debt, obligations the U.S. government notionally owes to itself. The EU version of that amounts to about 1.1 percent of EU GDP; the comparison remains useful, in my view, even if it is not exactly apples-to-apples, and different fiscal practices and government structures make more technically precise comparisons difficult.) There are millions of reasons the Scandinavian model probably would not work very well here (roughly 343 million reasons—Americans!), but as a purely fiscal matter there is much to be said for Nordic practice.

 

We could, still, even at this late hour, do something responsible and proactive to get this under control.

 

Or we could keep spinning the cylinder on the .44 magnum and see where this game of fiscal roulette takes us.

 

Words About Words

 

Some wordiness—and a little economics, too.

 

An unusually irritating Washington Post column bears the headline:

 

Targeting this $2.8 trillion tax shelter could solve a big U.S. problem

 

Only good can come from taxing these “nonprofits.”

 

I’m always interested in a good tax-shelter story. This isn’t a tax-shelter story. The “tax shelter” in question is ... the fact that large nonprofits exist. Scott Hodge, president emeritus of the Tax Foundation, has a bee in his bonnet about this, offering as an example the PGA Tour, which, like many sports leagues, is organized as a nonprofit. He writes:

 

The PGA Tour qualifies as a nonprofit “business league,” which means it pays no income taxes on the hundreds of millions it makes from tournament sponsorships and TV deals.

 

That is not quite right. (Surprise.) In reality, the PGA has both a nonprofit and a for-profit wing, and the revenue from media rights goes to the for-profit entity, PGA Tour Enterprises, which recently has booked hundreds of millions of dollars in profit and is liable for corporate taxes on its taxable income. PGA Tour events are, indeed, mainly organized as charitable endeavors, and the organization reports that it has distributed more than $4 billion in charitable contributions.

 

It gets a little complicated, but the PGA’s nonprofit/for-profit dual structure doesn’t appear to be so much engineered to shortchange the taxman as to shortchange star golfers whose PGA “equity grants” remain illiquid while the nonprofit arm, which is the majority owner of the for-profit organization, is loaded up with hundreds of millions of dollars in losses. I am here reminded of how some of the stars of the Star Wars franchise never saw big paydays on their back-end points because, thanks to the miracle of “Hollywood accounting,” some of those films never technically made money. I’m sure there is a tax-planning aspect to it as well, but it is not simply the case that PGA is putting gazillions of dollars into the pockets of executives, competitors, or shareholders without tax liability on its profits.

 

Sports leagues can be a little goofy: The NFL is not a nonprofit today, but it was a nonprofit for a long time. That doesn’t mean that the vast profits generated by professional football went untaxed during its nonprofit years: The NFL did not pay taxes, but Jerry Jones did, and other team owners did, shareholders did, and players and coaches did, etc. Sports leagues are in that sense like other business associations: The National Association of Realtors is a tax-exempt nonprofit whose job is to promote the economic interests of its members, but its members’ businesses are not tax-exempt. Neither are the earnings of the NAR staff and executives.

 

Hodge notes this about nonprofit hospitals:

 

Consider nonprofit hospitals and health care plans: In 2023, they generated $1.3 trillion in revenue and nearly $45 billion in tax-free profits. The largest, Kaiser Foundation Health Plan and its affiliated hospitals, recently announced over $127 billion in revenue in 2025 — more than many of America’s largest for-profit companies — yet paid no corporate income tax on more than $9.3 billion in net income.

 

But the reason that $9.3 billion in net income was not taxed is because it was not realized or distributed as taxable income. Nonprofit surpluses do not get paid out like corporate dividends—they get reinvested into the enterprise, which is where the money comes from if a nonprofit hospital chain wants to add, say, upgraded fetal MRI services or build a new cancer treatment facility. It is true that some nonprofit executives and employees get paid pretty well—Do you want a bargain-basement pediatric specialist for your sick kid?—and they pay income tax on those salaries and bonuses and whatnot the same way they would if they worked for for-profit companies. And when a nonprofit hospital spends $1 million on equipment from a for-profit business, that normally produces some profit for the for-profit business, which is taxed as business income under the usual procedures.

 

Some of this stuff is just the weird bias against enterprises that are big. It’s not like there are no corrupt or abusive small businesses, small towns, small government agencies, or small nonprofits. Hodge complains that the AARP’s sponsorship deal with the Washington Nationals is “hardly the action of your neighborhood nonprofit” and that the nonprofit sector includes many enterprises that are, in revenue terms, larger than many for-profit businesses: “The commercial revenue generated by these nonprofits totaled $2.8 trillion in 2023, nearly three times the amount nonprofits receive from donations and government grants.”

 

So, we’re supposed to be mad at nonprofit hospitals because they have found ways to generate revenue rather than rely on donations and government grants? That is a very odd complaint, in my view, as is the implicit preference for “neighborhood” nonprofits. Small organizations sometimes do great work—and so do large ones. Mom-and-pop do-gooder committees really cannot do the kind of work done by, say, the Red Cross or Catholic Charities. Some social purposes are better served by larger organizations than by smaller ones–or by cheap sloganeering about “neighborhood” this or that. The NAACP takes in tens of millions of dollars in revenue most years, and it uses that money to further its mission. Presumably, the NAACP could do more if it had more revenue at its disposal, and if it found ways to raise that revenue compatible with its mission, it is difficult for me to see how, exactly, that would be a bad thing.

 

Hodge has it exactly wrong, in my view. Rather than applying corporate taxes to nonprofits, we ought to get rid of corporate taxes entirely. That does not mean that the money earned by Microsoft or Goldman Sachs or the law firm of Nasty, Brutish & Short would escape taxation—it would mean only that the taxes would be paid by people, when they received actual income in the form of dividends, capital gains, salaries, bonuses, etc. There is a case (Megan McArdle makes it) for treating all income the same way, whether it is an ordinary paycheck or a dividend or an inheritance. There are good arguments on both sides of that (I think it would be good to reinforce incentives for long-term business performance when structuring executives’ compensation, but treating all income the same way would create a bias toward simple salaries), but, in any case, taxing corporate income per se and then re-taxing dividends distributed from that after-tax income is a cumbrous and kind of dumb way to do things.

 

Ah, but this is a language feature!

 

Do you know what a “tax shelter” is? It is a lot like a “loophole” or a “technicality” that sees an accused criminal go free: It is an aspect of the law that you don’t like. That’s all. Our laws may be stupidly written, but they are carefully stupidly written. The laws generally say what they say because somebody wrote the law that way on purpose. We didn’t create the nonprofit corporation by accident.

 

For comparison: We have a “standard deduction” of $15,750 for individual U.S. taxpayers—i.e., we shelter the first $15,750 in income—but nobody calls that a “tax shelter.” We don’t usually convict criminals who have been brought up on charges after illegal surveillance or following a search without a properly executed warrant or after a confession produced via torture, but it is rare to hear anybody denounce these considerations as “technicalities.” The fact that farm kids can do chores is not a “loophole” in our child-labor laws—that’s just the law.

 

It is particularly maddening when members of Congress denounce “loopholes” and “technicalities” and the like—if the lawmakers don’t like the laws, then they can change the damned laws, no?

 

If you want to raise more revenue for the federal government—I do! See the top item!—then there are better and worse ways to do that. When it comes to the federal income tax, we should probably have more taxpayers and fewer deductions. I don’t think putting the bootheel of the IRS on the Shriners Children’s hospitals probably gets it done.

 

And Furthermore ...

 

If you’ll forgive the hippie-punching, I always have the same thought when I read about one of these May Day blanket economic boycotts: If the big idea is to stop work and withhold consumer spending to show the world your economic might, then you should probably try to get your movement to include some workers and consumers whose absence will be ... noticed. In my world, I’d notice if Amazon deliveries stopped, and I’d be miffed if Jiffy Lube or Discount Tire weren’t open during their regular hours. (Those are two great American businesses, by the way, the kind of capitalism that just gets stuff done.)

 

But these May Day knuckleheads? What would you say you do here, kids? The Standard Practices of Right-Wing Columnists Handbook advises that I make a joke about baristas with gender-studies degrees here, but, in reality, the baristas I encounter on a regular basis are hardworking and capable, and many of them get to work before 5 a.m. pretty much every day five or six or seven days a week—and that is no joke. Farmers and ranchers and meatpackers aren’t taking the day off, and neither are owner-operator truck drivers, New York City cab drivers, ER nurses, home health aides, the people who staff mental health crisis hotlines, or, God bless them, what’s left of America’s local newspaper reporters. Discount Tire will still fix your flat for free wherever you bought the tire in the hope that you’ll buy your next one from them. I’ll bet that whoever sells those Palestinian flags to the idiot children who wave them on college campuses is hard at work, too.

 

I’m sure that somebody is taking the day off. Just nobody who does work that I care about.

 

In Closing

 

Of course the United States now makes troop-deployment decisions in response to Donald Trump’s hurt feelings. What a dumb time to be alive.

 

Of course worldwide material abundance is shockingly high and rising. What an amazing time to be alive.

Labor Secretary Chavez-DeRemer Is Out — Take Your Pick of Provocations

By Will Swaim

Monday, April 20, 2026

 

Donald Trump has pushed Secretary of Labor Lori Chavez-DeRemer off Love Island, in part perhaps because of antics that looked like outtakes from a cringeworthy reality show.

 

In January, the Department of Labor’s inspector general began investigating allegations that Chavez-DeRemer ordered her staff to create official-looking reasons for personal travel, that she was a day-drinker and had an extramarital affair with a member of her security team, that she took staff to dine at strip clubs — because who doesn’t go to a jiggle joint for the fine food?

 

White House Communications Director Steven Cheung said Chavez-DeRemer was leaving “to take a position in the private sector.” In a separate release, Chavez-DeRemer praised herself and her accomplishments — claims that Joe Biden’s acting Labor Secretary Julie Su might have bragged about.

 

C-DR’s real misdeeds (in one person’s mind, at least) had to do with her loyalty to government unions. As I wrote during her nomination a year ago:

 

Trump has nominated Oregon Representative Lori Chavez-DeRemer to take Su’s desk at the Labor Department. As Trump did, Chavez-DeRemer’s 2022 congressional campaign attempted to square a circle: to bring together Republicans and organized labor in one slightly rotten Reese’s peanut butter cup. She won narrowly. Once in Congress, Chavez-DeRemer was as good as her word. She co-authored the PRO Act — Biden’s attempt to root Su’s rule change in federal law — and supported Biden’s federal Public Service Freedom to Negotiate Act; far from freeing anyone, that law would force government workers everywhere to join unions and would require their government agencies to negotiate with those unions. Since 1978, that same coercive policy has wrecked California government finances, raised taxes, and blunted all attempts to reform any government agency, including the state’s underperforming public schools.

 

Chavez-DeRemer’s strategy worked until it didn’t. In 2024, Oregon union leaders poured cash into the campaign of Chavez-DeRemer’s Democratic opponent. After November 5, Chavez-DeRemer was looking for work.

 

Trump appears to have rescued her. But the only people truly happy with his choice are union leaders — the very people who would gladly travel back in time to kill Trump in his cradle. They have universally expressed their affection for Chavez-DeRemer. Teamsters President Sean O’Brien is credited with pushing her nomination. American Federation of Teachers President Randi Weingarten — who has called Trump an “existential threat to democracy and freedom” — was suddenly transformed: “Now, this would be a significant appointment for Trump to make,” she crowed on X, of Chavez-DeRemer.

 

You know you’ve screwed up when Randi Weingarten praises you.

 

You’ve also screwed up pretty badly when you let your anesthesiologist husband roam the Labor Department. A New York Times report last week said Dr. Shawn DeRemer, “an anesthesiologist, was barred from the department headquarters this year after several women told the inspector general’s investigators that he was making unwanted advances at them. One of the women filed a report with Washington’s Metropolitan Police Department, which opened a sexual assault investigation. The department and the federal prosecutor’s office later said they would not bring charges in the matter.”