Today, Hoover invites you to an event on the future of national security featuring leading practitioners in the field; Hoover scholars react to the electoral defeat of the proposed California billionaire wealth tax; and John Cogan explains how economic growth and federal spending restraint could balance the budget within 15 years, without drastic cuts to entitlement programs.
Hoover Opportunity
A quarter century after the 9/11 terrorist attacks, advances in surveillance and technology have transformed how the United States protects its security and have raised enduring questions about privacy, government power, and democratic accountability. On Thursday, November 12 at the Hoover Institution, Distinguished Visiting Fellows Anne Neuberger (former deputy national security advisor) and Christopher Wray (former FBI director) will join Senior Fellow Amy Zegart to examine how the security landscape changed in the years following 9/11. The panelists will also consider how emerging technologies are reshaping American security yet again, as well as how a free society can navigate the challenges ahead. Learn more and register here.
California Decides
A team of Hoover scholars that carefully studied California’s Proposition 40, the Billionaire Tax Act, welcomed the decision by the state’s voters to reject the ballot measure. Voters rejected the proposed tax by 53 to 47 percent as of November 9. Proposition 40 would have imposed a one-time 5 percent tax on the assets of anyone with more than $1 billion in assets who resided in the state as of January 1, 2026. Research Fellow Benjamin Jaros, part of a team of Hoover scholars who generated studies looking at the impacts of the proposal on the state’s public finances and future economic growth, saw wisdom in the decision by voters to reject the idea. “Voters have rejected Prop 40. They recognize, like many others who have left the state, that something is broken in the social compact for the state,” said Jaros. Read more here.
Economics
Many Americans think that balancing the federal budget would require deep cuts in entitlement programs. But as Senior Fellow John F. Cogan shows in this paper, the budget can be balanced within 15 years through modest and sustained federal spending restraint and moderately higher economic growth. Key to this spending restraint, Cogan argues, is to limit the growth in the average future value of entitlement benefits per recipient to today’s level, after adjusting for inflation and rising healthcare costs. While stronger economic growth is also essential to balancing the budget, that growth need not be unprecedented. As Cogan shows, when paired with spending restraint, economic growth that matches average growth over the past 30 years would eliminate the federal budget deficit over 15 years. This paper reflects Cogan’s many years of scholarship on fiscal policy issues, as well as the Hoover Institution’s commitment to generating real solutions to the nation’s financial challenges. Read more here.
Given the prominence of stock-market riches, high home prices, and big salaries paid to AI workers, the question of whether American workers’ pay has kept pace with inflation is a complicated one, writes Visiting Fellow Mickey D. Levy at Defining Ideas. Comparisons of wages with certain data, such as the labor share of GDP, are misleading, he argues. Levy also says it’s possible to overlook how technological innovations enhance workers’ productive capacity. He proposes two factors to assess when gauging wages: excessive monetary accommodation by the Federal Reserve and the persistently high inflation driven by that accommodation. Ultimately, Levy concludes, the demoralizing effect of inflation is causing American workers to lose confidence in the economy. Read more here.
History and Strategy
In this post at his History We Don’t Know Substack, Senior Fellow H.R. McMaster reflects on the parting of the Iron Curtain, which marked “the beginning of the end of the Cold War.” As he writes, “That dramatic moment inspired confidence and that confidence led to the wide acceptance of three flawed assumptions about the post–Cold War era: that history had ended, that great-power competition was passé, and that American military technology had made war a contest we could not lose.” After sharing an excerpt from his book Battlegrounds connected to this history, McMaster warns that “the strategic narcissism of the 1990s is making a comeback.” Russia and China, under their current autocratic leadership, “have aspirations that go far beyond the US ability to conciliate them,” the former national security advisor says. “What provokes them is the perception of weakness.” Read more here.
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