The Hoover Institution hosted its annual Spring Retreat beginning on Sunday, April 21, 2013, with before-dinner remarks by Kevin Warsh, a distinguished visiting fellow at the Hoover Institution and a lecturer at the Stanford Graduate School of Business. His speech, titled “The Economy over the Horizon: Unknown Knowns,” emphasized the importance of the state of the economy, which currently has a 2 percent growth rate, and understanding the concept of “unknown knowns,” a reference to former secretary of defense Donald Rumsfeld. Warsh also referred to Hoover fellow George Shultz’s idea of “thinking long” in terms of government policies, stating that “our government policies aren’t ‘thinking long’ as George describes it. “As a result, we find ourselves with an economy that continues to chronically disappoint and we have fewer degrees of freedom with every passing day,” he stated. Warsh discussed why the economy continues to disappoint those in Washington, the challenges and what is going to happen in the economy next, concluding with the “unknown knowns,” which he described as “things we should know, but we seem to have forgotten.” Warsh concluded on a more positive note, talking about how the United States will remember the “unknown knowns,” “put these good policies in action,” and, in the next five to ten years, they “will surprise [us] again on the upside.”
Clint Bolick, a research fellow at the Hoover Institution who also serves as the director of the Goldwater Institute Center for Constitutional Litigation in Phoenix, and Jeb Bush, the former two-term governor of Florida who currently serves as president of Jeb Bush and Associates, gave the before-dinner remarks on Monday, April 22, 2013, during which they discussed their recent publication Immigration Wars: Forging an AmericanSolution(Threshold Editions, 2013). Bolick, emphasizing the need for change in the current immigration laws, introduced four major policy changes that he and Jeb Bush recommend in their book. Bolick and Bush first suggest a dramatic increase in the number of high-skilled visas and expanding the high-skilled visa program generally. Second, they recommend increasing the number of low-skilled workers. Third, they encourage reducing family preferences and advocate narrowing the definition of nuclear family to spouses and minor children. Fourth, they argue for restoring the old “Ellis Island” system of immigration.
Bush emphasized the importance of shared values and the need to not accept a new normal or surrender to mediocrity. He pushed for a more positive outlook on immigration, described three things the general public needs to know to become engaged in the issue. First, he discussed the role of demography and how much fertility rates and marriage rates have dropped in the past four years. Second, he stated that, economically, “I believe that our country could grow at 3 percent or 4 percent rather than this so-called new normal which is 1 percent or 1 and a half percent. If that’s the case, then we need young, energetic, aspirational people.” Third, Bush explained, is politics; “The politics is important because it’s the path to be able to implement sound policies.”
John Raisian, the Tad and Dianne Taube Director of the Hoover Institution, in his welcoming remarks on Monday morning, discussed the schedule of events; the abundance of electronic media outlets, including iPads, iTunes, Kindle, Facebook, Twitter, and YouTube in the media kiosk; the new Hoover Archives exhibit titled Art and History: Treasures from the Hoover Library and Archives , which showcases the work of artists who captured in their art unique periods in history, and two permanent exhibits in the Hoover Tower dedicated to former president Herbert Hoover and his wife, Lou Henry Hoover.
Mary Meeker, a general partner at Kleiner Perkins Caufield & Byers, gave a talk titled “Internet Trends and USA, Inc.” Meeker has coauthored various industry-defining books, including The Internet Report (1995) and The Internet Advertising Report (1996). Beyond technology, she and Liang Wu in 2011 created USA, Inc., an award-winning, nonpartisan report/video that looks at the US government and its financials from a business perspective. Meeker examined the profound changes in connectivity by examining the Internet and mobile devices. Using Powerpoint slides to illustrate her findings and statistics, she began by showing the basic stats of Internet users and the profound growth in users during the past four years. According to her findings, “global Internet growth remains robust, [and] rapid mobile adoption [is] still in [the] early stages” (Meeker Powerpoint slides) Meeker also discussed the reimagination of communications powered by global mobile devices, messaging, and social networks. She pointed out the success of Twitter and how the “right message at the right time can change history.” She gave historical examples of Martin Luther King’s “I Have a Dream” speech and Ronald Reagan’s famous quote “Mr. Gorbachev, tear down this wall [Berlin Wall].” Meeker also highlighted the following quote by Facebook founder and CEO Mark Zuckerberg, who she believes is on the right track.
“We hope to rewire the way people spread and consume information…We think a more open and connected world will help create a stronger economy with more authentic businesses that build better products and services.”
She also referenced Google founders Larry Page and Sergey Brin and their goal to “organize all the world’s information and make it universally accessible and useful.”
Joshua Rauh, a senior fellow at the Hoover Institution and a professor of finance at the Stanford Graduate School of Business, discussed wealth inequalities in his speech “Rising Inequality at the Top: Evidence and Misperceptions.” Working with Steve Kaplan, Rauh discussed his findings about wealth inequality in a Powerpoint presentation, which he began by talking about the inequalities in the top 1 percent and facts about gains and losses. Rauh found that the top 1 percent has taken more losses than in previous years and has not done so well so far this century. Theories to explain why such inequality has risen include trade or globalization, managerial power, social norms, skill-based technological change, and taxes (PowerPoint slides). He also touched on where the extra income comes from and how CEOs are paid relative to others. Rauh, using evidence from the Forbes list, researched the top 400 wealthiest individuals in the United States; he found that more people were self-made millionaires in successful industries such as computer technology, retail, restaurants, finance, and investments. In conclusion, Rauh stated that “the main drivers [that] increase income inequality in the US are technological change, increased scale of interaction, and globalization.”
Rauh is also a research associate at the National Bureau of Economic Research. He specializes in empirical studies of corporate investment and financial structure as well as on the financial structure of pension funds and their sponsors.
Victor Davis Hanson, the Martin and Illie Anderson Senior Fellow at the Hoover Institution, talked about “War in the Contemporary World.” He began his talk by introducing a new project that Hoover launched today called Strategika, an online journal analyzing contemporary national security issues from a historical perspective. Strategikais published by Hoover’s newly convened Working Group on the Role of Military History in Contemporary Conflict, which examines how historical military operations intersect with contemporary public policy decisions concerning prevailing conflicts. Hanson described the platform of Strategika as involving a showcase of history every two weeks by two people with opposing views. He also mentioned additional aspects, including a comments section, polls, bibliography, and talking points of each piece on both an analytic level and for the general public. Hanson then discussed the issue of conflict and what history says about it, citing examples including the Balkans and Hitler’s invasion of the Soviet Union in June of 1941 and how these wars ended. Hanson concluded by saying that “although war will always be there, there are mechanisms to prevent them and ameliorate their destructive results…We’re all going through a dark tunnel and it’s scary every day when we get up, but we have a torch, a light, to see the way through and we feel a little bit more comfortable and that’s what history is. It’s our light that allows things to be illuminated so when we go through every morning these disastrous stories throughout the world, we have somebody who says, ‘don’t panic.’ There are people in the past who can offer you guidance and wisdom.”
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Russ Roberts, a research fellow at the Hoover Institution, focused on “The Curious Economics of the Minimum Wage.” In President Obama’s State of the Union address, he pushed for increasing the minimum wage to $9.00 per hour. Roberts stated, “On the surface, this seems like a great idea…A bunch of low-wage workers will get a raise, all those earning between $7.25 and $9.00. It seems like a very attractive, antipoverty program.” But, Roberts argued, it would be a mistake to increase the minimum wage, explaining that “the minimum wage takes low-skilled workers, people who have relatively low levels of education and skills and makes them more expensive.” Some economists who are for the increase “argue that raising the minimum wage will have no effect on employment or trivial minimum, almost zero effect.” Roberts discussed the notion that low-skilled workers have no bargaining power. “The minimum wage, ironically, creates a reserve army of unemployed. It creates a bunch of people who are desperate to work at this high wage and reduces the number of opportunities that are available.” He concluded, “The last thing we should do is raise the minimum wage. We should abolish it.”
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Hoover fellows Daniel Kessler, Abraham Sofaer, and Shelby Steele participated in breakout sessions on Monday afternoon. Kessler, a senior fellow at the Hoover Institution and a professor at the Graduate School of Business at Stanford University, discussed “ObamaCare’s Broken Promises.” Sofaer, the George P. Shultz Distinguished Scholar and senior fellow at the Hoover Institution, gave a speech titled “Iranian Nukes: Is the U.S. President ‘Bluffing’?” Steele, the Robert J. and Marion E. Oster Senior Fellow at the Hoover Institution, gave a talk titled “Obama Didn't Win, Republicans Lost: How Republicans Can Win Again.”
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Monday afternoon continued with breakout sessions including speakers Peter Berkowitz, Russell Berman, and Bruce Thornton. Berkowitz, the Tad and Dianne Taube Senior Fellow at the Hoover Institution, discussed “Constitutional Conservatism: Liberty, Self-Government, and Political Moderation.” Berman, the Walter A. Haas Professor in the Humanities at Stanford University, a senior fellow at the Hoover Institution, and a member of the Working Group on Islamism and the International Order, gave a speech titled “The European Union from Crisis to Crisis: Learning from Angela.” Thornton, a research fellow at the Hoover Institution, talked about “America’s Foreign Policy Options.”
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Click the play button below to listen to Berkowitz’s full talk
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The breakout sessions on Monday afternoon concluded with Lanhee Chen and Kori Schake. Chen, a research fellow at the Hoover Institution and professor at the Public Policy Program at Stanford University, gave a speech titled “Does Policy Matter? A Behind-the-Scenes Look at the Role of Issues in a Presidential Campaign.” Schake, a research fellow at the Hoover Institution, discussed the state of North Korea in her talk titled “Managing an Increasingly Hostile North Korea.”
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Tuesday morning began with John Raisian’s opening remarks followed by Jack Goldsmith, a member of the Task Force on National Security and Law and the Henry L. Shattuck Professor of Law at Harvard University. Goldsmith defined drones and their usage under the Bush and Obama administrations and the implications of their use in his speech titled “Targeted Drone Strikes: Their Importance and Dangers.” Goldsmith defined a drone as a “remotely controlled, unmanned aerial vehicle which has many useful purposes.” Although their original military purpose involved remote sensing drones are now used in warfare for many reasons, including the cost, small footprint, extraordinary surveillance, low risk, and fast-fire and precise-fire capabilities, making them some of the most precise weapons the government has it its possession. Goldsmith also talked about the limited number of drone strikes in Afghanistan, Yemen, and Pakistan during the Bush administration and the increased drone usage during the Obama administration. He stated, “There were more strikes in Yemen and Pakistan in 2009 than in Bush’s entire term.” Lastly, Goldsmith mentioned the lack of strategic success because drones are deeply unpopular abroad owing to the civilian causalities.
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John Taylor, the George P. Shultz Senior Fellow in Economics at the Hoover Institution and the Mary and Robert Raymond Professor of Economics at Stanford University, gave a talk titled “The Economic Consequences of the Budget Debate.” Taylor used charts to describe the sequester issue of federal outlays as a share of GDP and how he believes that progrowth reform is the best option for the economy. Taylor then analyzed the House budget (the first budget out this year) using a chart showing a ten-year span from 2013 to 2023. Taylor explained that how his green line (his plan) in the chart would balance the budget, not increase taxes, and bring spending rates down. Taylor stated, “The idea then is to say maybe if people realize that the green plan will mean taxes don’t have to increase; that since government is small there would be more income so people consume more. Maybe that extra consumption or that extra investment will offset any reduction to government purchases.” According to Taylor, his model would reduce GDP and provide an opportunity for tax reform. Lastly, Taylor talked about the similarity between the Senate and White House proposals and explained how it’s become accepted today that the Senate and House budgets will never balance. “Based on conversations with members and senators, there are things that we need to be doing and this has negative effects on the country,” Taylor concluded.
Richard Epstein, the Peter and Kirsten Bedford Senior Fellow at the Hoover Institution, the Laurence A. Tisch Professor of Law, New York University Law School, and a senior lecturer at the University of Chicago, discussed property rights in his talk “Property Rights in the Spectrum: License versus Ownership.” Epstein followed the evolution of property rights from a hundred years ago up to the present day, thus connecting to the theme of his most recent publication, Design for Liberty: Private Property, Public Administration, and the Rule of Law(2011). He went on to explain how technology created the spectrum, the social structure, and the general conception of organization. Epstein stressed the “importance to sort of understand how it is an empirical and practical matter, the traditional conceptions of property rights blend fairly well with the rule of law.”
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Fouad Ajami, a senior fellow at the Hoover Institution and the cochair of the Herbert and Jane Dwight Working Group on Islamism and the International Order, concluded the event with his speech “The Sunni-Shia Schism and the War for the Fertile Crescent.” Ajami began by giving the audience a pop quiz to give insights into the history and variety of Islam and the differences between Sunni Islam and Shia Islam. Some of the twenty questions were adopted from the Christian Science Monitor and drew from both history and contemporary examples of the Islamic experience. The second part of his talk surveyed the struggle for Syria between the dictatorship of Bashar al-Assad and the rebellion arrayed against him. He then discussed Syria’s long drawn-out struggle and its impact on its neighbors: Lebanon, Iraq and Jordan in particular. The fight for Syria also pits regional Sunni powers—Turkey, Saudi Arabia, and Qatar—against the Iranian theocracy and its determination to prevail in Syria. In the third part of the talk he described the Boston bombers as "children of the fault lines," on the seam between America and the Old World from which they came. He gave other examples of such unsettled young men, including the Pakistani Faisal Shahzad, who in 2010 tried to detonate a car bomb in Times Square, and the Lebanese Ziad Jarrah, who was thought to have been at the controls of one of the planes on 9/11.
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