What Can You Do With Your Old 401(k)?


(NewsUSA) - Just started a new job with an employer who thinks you're as visionary as Steve Jobs? Or maybe you're between gigs and "exploring other opportunities." Either way, you need to decide what to do with your old 401(k).

It's been estimated that there are about 15 million such accounts left behind by former employees, mainly because of either inertia or plain confusion over strict rules for moving the money. And since the IRS doesn't allow procrastinating on a key decision -- if you withdraw even a dime, you've got just 60 days to reallocate into a different tax-advantaged account -- here's a rundown of your options to avoid what could be a costly mistake:


* Option No. 1: Cash Out

Unless you're in dire financial straits and really, really need the bucks to live off, the consensus is this is a bad idea.


"Cashing out comes with an immediate price, both in terms of giving up potential future gains in your portfolio and in the IRS taxes the company handling your 401(k) for your former employer is legally obliged to withhold," explains Nupur Bahal, vice president for retirement at Fidelity Investments. "That's money you won't have for retirement."


Yes, the government must have its cut. Specifically, 20 percent in federal income taxes, 10 percent in an "early-withdrawal penalty" for those under age 59?, and -- wait, we're not done yet -- whatever additional percentage your individual state may or may not assess.


Translating that into real money, Fidelity's website (fidelity.com) uses the hypothetical example of a 36-year-old who decides to cash out the $16,000 balance in her account. After deducting just the federal taxes and penalties, she'd be left with only $11,200.


Feel free to imagine how much you'd be out if your account is fatter.


* Option No. 2: Move the Money to Your New Employer's Plan

Doing what's called a "rollover" is an easy way to keep your 401(k) savings together and growing tax-deferred.


But bear in mind: Investment options vary from plan to plan -- as do fees. (And not all employers even accept rollovers.)


Which means you might want to do some comparison shopping before committing.


* Option No. 3: Move the Money Into an IRA

As with the previous rollover, you get to avoid the tax bite of cashing out. The difference here, though -; and these could be major plusses -- is that not only do IRAs offer more investment choices than the typical 401(k), but you're also able to make penalty-free withdrawals for qualified education expenses or up to $10,000 for a first-time home purchase.


"Especially if you already have other, non-401(k) accounts elsewhere, it may be simpler and more effective to consolidate everything under one roof," says Bahal.


* Option No. 4: Leave It With Your Ex-Employer


Penalty-free withdrawals are allowed for those who leave their jobs at age 55 or older -- as opposed to 59? for IRAs -- and unique investment options might warrant just letting things ride. But some people forget the account exists with the passage of time -- no, really -- and further contributions are verboten.


Whatever you decide, remember the clock is definitely ticking for you to contact your old 401(k) administrator should you choose to withdraw even that one dime.

Remembering "We Were Soldiers" Hero, Hal Moore

Editor’s Note: I met Hal Moore on several occasions, and he was a true gentlemen, an inspiring figure, a reminder of the old-school military code to dread war but to fight hard with courage when duty called. His book, which I've also read, underscores the hardship and horror of war, a realistic book that strips away all romance associated with the bloody enterprise. This is why his book is one of the most read among active duty personnel and has become a major reason why today's enlisted officers and soldiers tend to be much more cautious about going to war than their civilian leadership. Moore was the right kind of patriot. He upheld the old code: bravery and courage are prized virtues but they are best served by seeking peace first and avoiding war, the costs of which are gigantic and terrifying. ~ Jeffrey Tucker

America lost a role model on Saturday when Hal Moore passed away at the age of 94.

Harold “Hal” Moore was a retired three-star Army general, but he will forever be remembered for his courageous actions as the commanding officer of the 1st Battalion, 7th Cavalry in the Battle of Ia Drang Valley in November 1965.

Memorialized in the book and subsequent movie “We Were Soldiers Once… And Young,” Moore and his battalion conducted an audacious helicopter assault right into the midst of three North Vietnamese regiments in the Central Highlands of South Vietnam and were immediately faced with an enemy onslaught.

Undeniable Heroism


Surrounded, outnumbered, and faced with mounting casualties, Moore, then-lieutenant colonel, skillfully orchestrated his unit’s harrowing defense, moving units around to fill gaps, calling in artillery and air support, and most importantly leading by example, exposing himself to all the dangers faced by his men.

The battalion sustained casualties that were unheard of at that early stage of the war, with 71 soldiers being killed during the engagement.

There were multiple moments during the terrible three days and two nights where the unit was in danger of being overrun, but in each instance the troopers of the 1/7 under Moore’s leadership rallied and threw the enemy back.

The North Vietnamese lost over 1,000 soldiers in this pitched battle.

“We Were Soldiers Once… And Young” wasn’t published until 1992, but it quickly became a mandatory read for Army officers in the 1990s and remains a key volume on most recommended military reading lists.

My own copy is dog-eared and worn from use. It’s not grand strategy but remains one of the most compelling stories of how determined leadership and heroism made the difference during those three days in November 1965.

Highest Honors


Moore, who went on to become a lieutenant general, was awarded the Distinguished Service Cross, our nation’s second-highest award for valor, for his actions in the Ia Drang.

He retired from the Army in August of 1977 after 32 years of service, and went on to become the executive director of the Crested Butte ski area in Colorado. He remained humble and self-effacing about his service.

One of Moore’s soldiers, Spc. 4 Pat Selleck, recalled a short ceremony when Moore said goodbye to him after the Ia Drang battle:
Col. Moore shook our hands and said, ‘Thank you and go back home.’ I was the second or third guy he spoke to and he had tears in his eyes. I remember what he said: ‘I see that you are married; you have a wedding ring on. Just go home, pick up the pieces, and start your life again.’ And basically that’s what I did. I came home to a wonderful wife, tried to readjust, did a decent job at it. I did what Col. Moore said. I tried to put the war behind me. … He might be a general, but to me he’s still Col. Moore. If it wasn’t for him and all his knowledge and training, I don’t think any of us would have survived the Ia Drang Valley."
Moore embodied the virtues Americans look for in their heroes: courage under fire, inspiring leadership in peace and war, professional integrity, and personal humility.
America mourns the loss of such a hero, but Moore’s legacy will live on in the generations that study the example he most clearly gave in Ia Drang.

Reprinted from the Daily Signal.
Thomas Spoehr
Thomas Spoehr
Lt. Gen. Thomas W. Spoehr, U.S. Army (Ret.), is a director for the Center for National Defense at The Heritage Foundation.
This article was originally published on FEE.org. Read the original article.

Legislation Would Curb Restrictions on Political Speech in Churches

Congress is taking aim at a 1950s-era law that restricts the free speech of churches and other nonprofits after President Donald Trump recently condemned it.

Trump pledged at the National Prayer Breakfast earlier this month, “I will get rid of, and totally destroy, the Johnson Amendment and allow our representatives of faith to speak freely and without fear of retribution.

Rep. Jody Hice, R-Ga., was a pastor for 25 years before serving in Congress, which is one reason he favors doing away with the Johnson Amendment. The law threatens the tax-exempt status of nonprofits, including churches, for engaging in certain political speech.

“For too long, the IRS has used the Johnson Amendment to silence and threaten religious institutions and charitable entities,” Hice said in a public statement. “As a minister who has experienced intimidation from the IRS firsthand, I know just how important it is to ensure that our churches and nonprofit organizations are allowed the same fundamental rights as every citizen of this great nation.”

Hice and House Majority Whip Steve Scalise, R-La., announced their bill to repeal the law the same day Trump pledged to at the National Prayer Breakfast.

Repealing the Johnson Amendment was included in the GOP platform adopted at the 2016 Republican National Convention that nominated Trump.

The bill would amend the U.S. tax code to allow 501(c)(3) nonprofit organizations to speak out on political matters so long as the commentary is made in the ordinary course of the carrying out of a group’s tax-exempt purpose, and as long as no expenditures are made to promote the message that might relate to a candidate.

Sen. James Lankford, R-Okla., the co-chairman of the Congressional Prayer Caucus, has a companion Senate bill, which he said is crafted to ensure more political speech rights, but also won’t allow churches and nonprofits to become political action committees.

“The Free Speech Fairness Act is needed to prevent government intrusion and suppression of free speech by removing a restriction on speech that has existed since 1954,” Lankford said of his bill in a public statement. “The First Amendment right of free speech and right to practice any faith, or no faith, are foundational American values that must extend to everyone, whether they are a pastor, social worker, or any charity employee or volunteer.”

However, Rob Boston, spokesman for Americans United for Separation of Church and State, insisted repealing the Johnson Amendment could unleash money in politics and corrupt the purpose of churches.

“This is an issue closely identified with the religious right, but it would affect every organization with 501(c)(3) status, not just houses of worship,” Boston told The Daily Signal in phone interview. “You might see sham nonprofits start up to funnel money to campaigns. Tax-exempt status is a benefit, but it does come with conditions.”

Boston said this is a question of bad policy rather than a constitutional matter.

“I don’t think [getting rid of the Johnson Amendment] would be an Establishment Clause violation unless the repeal was limited to houses of worship,” Boston said.

A leaked draft executive order from the White House showed the Trump administration was considering an inclusive order to recognize the right to religious expression, not just the right to worship. Once this was reported, several liberal groups stepped up to oppose the action.

A concern to some conservatives is that Trump will attempt to address the Johnson Amendment matter through an executive order, while ignoring other significant religious freedom concerns.

Melanie Israel, a research associate with the DeVos Center for Religious and Civil Society at The Heritage Foundation, told The Daily Signal in a statement:

Should Trump issue an executive order that only addresses the Johnson Amendment, it would be a tremendous disappointment because the Johnson Amendment cannot be fully addressed by executive order and must ultimately be repealed by Congress. In the meantime, there are high-priority items that can be fixed by the text of the draft executive order earlier this month. Trump should move quickly to make good on the commitment that his administration will do ‘everything in its power’ to protect religious liberty. The draft copy of the leaked executive order is a good, lawful public policy that would ensure that the public square remains open to all religious voices, including those whose voices differ from the government’s view.

The Johnson Amendment was named after then-Sen. Lyndon B. Johnson, a Texas Democrat, in 1954. Johnson was the Senate minority leader at the time, and he and other lawmakers were concerned 501(c)(3) nonprofit groups would get involved in the elections on behalf of their opponents.

Just before the Senate’s summer recess, Johnson, who would go on to become vice president and later president, pushed through an amendment to rescind a charitable nonprofit’s tax-exempt status if such an organization—including churches—campaigned for or against a political candidate.

The text of the House and Senate bills protect liberal and conservative groups and churches of any leaning, said Travis Weber, director for the Center for Religious Liberty at the Family Research Council.

“This loosens up simple speech on churches or environmentalist nonprofits or other groups,” Weber told The Daily Signal. “Some might seize on this and say this repeal would be good for just Republicans or for Christian conservatives, but they aren’t looking at the law to see who it protects.”

Report by The Daily Signal's Fred Lucas (@FredLucasWH).  Originally published at The Daily Signal.

House Conservatives Draw Hard Line on Obamacare Repeal Bill

Conservatives in the House are drawing a hard line with party leadership on what legislation repealing Obamacare they’ll support and making it clear they won’t accept anything less than a bill dismantling the health care law that passed last year.

“The commitment for Republicans in 2010, 2012, 2014, 2016 has been repeal and replace, not repeal and renege, and repeal means that it’s a repeal,” Rep. Warren Davidson, R-Ohio, told reporters at a monthly event on Capitol Hill on Tuesday. “There are no Affordable Care Act plans. There’s no ‘if you like your Obamacare you can keep your Obamacare’ in the Republican commitment.”

“It should carry today, and that’s a question for the Senate if somehow there’s a lack of will to do what they’ve already done,” he continued.

Republicans are currently in the midst of debating which parts of Obamacare should be repealed, with conservatives splitting from more moderate members of the party.

On Monday night, the roughly 40-member House Freedom Caucus unanimously voted to back a plan to bring a 2015 bill repealing major parts of Obamacare before members again for a vote.

That legislation repealed the individual and employer mandates, the law’s taxes, subsidies, and Medicaid expansion. It also stripped the government of its authority to run the exchanges, and defunded Planned Parenthood.

The repeal bill crafted in 2015 passed both the House and the Senate, but President Barack Obama vetoed it.

But with Republicans now in control of the White House, conservatives are emboldening their colleagues—many of whom voted in favor of the 2015 bill—to put that same legislation on President Donald Trump’s desk.

And they’re not going easy on their fellow Republicans.

“Members of Congress are scared all the time,” Rep. Raúl Labrador, R-Idaho, told reporters. “They need to actually just lean in, move forward, and do what they told the American people they were going to do.”

Conservatives like Labrador have long maintained the position that they must repeal as much of Obamacare as possible—a campaign promise they say has resonated with voters since the 2010 midterm elections.

But now, some of their colleagues are approaching an undoing of the law with trepidation and are opting for repairing, not repealing, the law.

“When you hear about [the Cassidy-Collins bill], when you hear about repair, when you hear about not getting rid of all the taxes, when you hear about not defunding Planned Parenthood, it sort of makes you wonder [if they’re backing away from repeal],” Rep. Jim Jordan, R-Ohio, told The Daily Signal.

Members of the Freedom Caucus have met with some of their Senate colleagues like Sen. Bill Cassidy of Louisiana to discuss Obamacare’s repeal, and Jordan said their appeal to those who want to unwind less than what the 2015 bill did is simple.

“You done voted on it,” he said. “Everyone voted on it, so let’s at least do that.”

Rep. Mark Meadows, a Republican from North Carolina who now leads the Freedom Caucus, echoed Jordan’s statements.

“To suggest that we can pass it in 2015 and that it’s more difficult to do it in 2017 makes for a very difficult argument for anyone on why they’ve changed their position and were willing to vote for it then and aren’t willing to vote for it now,” Meadows said.

For Republican members who may be waffling on Obamacare repeal, turning to instead repair the law, Labrador had a warning.

“Something that Republicans need to be concerned about is if we’re just going to repeal Obamacare with ‘Obamacare lite,’ then it begs the question: Were we just against Obamacare because it was proposed by Democrats? And if that’s our position, then we’re very hypocritical. Then we really were just taking a political position, not a policy-based position,” he said.

“If we’re going to come back with something that does exactly the same thing as Obamacare but change a couple of things, and just call it Trumpcare or Ryancare, then what was our fight about for the last six years?” Labrador continued.

At a press conference Tuesday morning, House Speaker Paul Ryan and members of the GOP leadership team reaffirmed their commitment to repealing, not repairing, Obamacare, but there are still major differences among Republicans in the House and Senate on what to undo and what to include in the repeal bill.

While conservatives are looking to the 2015 bill to serve as a starting point for negotiations, Republican senators like Cassidy and Susan Collins of Maine believe Congress should wait to repeal Obamacare’s taxes, which were included in the previous legislation.

Additionally, Republican leaders have said they want to include parts of a replacement—tax credits, expansion of health savings accounts, and creation of high-risk pools—in the legislation repealing the bill.

Last week, though, Sen. Mike Lee, R-Utah, said grouping the two together is a “horrible idea.”

Members of the Freedom Caucus, however, haven’t explicitly ruled out including aspects of a replacement in a repeal bill, so long as the 2015 legislation serves as the starting point for negotiations.

Still, conservatives in both chambers are in agreement that the 2015 plan should serve as the floor for the upcoming repeal legislation, and the comments from the lawmakers put further pressure on Republican leaders.

If House leadership puts a bill before its members that repeals less of Obamacare than the 2015 legislation did, then members of the Freedom Caucus said they’ll oppose it.

The repeal bill in the House needs 218 votes to pass, and without the support of the more than 40 members of the group, the legislation fails.

Similarly, GOP Sens. Ted Cruz of Texas, Marco Rubio of Florida, and Lee sent a letter to Senate leaders last month notifying them that the same 2015 legislation should be used as the floor for future repeal legislation.

Sen. Rand Paul, R-Ky., echoed that statement Tuesday, telling Axios that the 2015 bill should be “the minimum that we do … no less.”

The GOP holds 52 seats in the Senate, and Republicans can’t lose more than two votes on the reconciliation bill, which passes with 51 votes.

If Senate leaders put a bill repealing less of Obamacare than the last bill did, they could lose the support of Paul, Rubio, Cruz, and Lee, which would kill the bill.

Report by The Daily Signal's Melissa Quinn (@MelissaQuinn97). Originally published at The Daily Signal.

House GOP probing whether Trump mishandled classifed North Korea documents

Photo credit: richarddeagazio/Facebook

House Oversight Committee Chairman Jason Chaffetz issued a formal letter to the White House Tuesday demanding information regarding what appears to be criminal mishandling of classified documents by President Donald Trump.

As Trump was dining at his Florida Mar A Lago resort with Japanese Prime Minister Shinzo Abe Sunday night, news broke North Korea had tested a new nuclear-capable missile.  Rather than break the from party to receive the emergency intelligence briefing, Trump conducted the meeting in the middle of the public restaurant.

Guests seated near Trump at the restaurant snapped cell phone photos of the President reading sensitive intelligence documents and posted them to Facebook.

Chaffetz's letter asks the White House to explain what security measures were taken, the classification levels of the documents displayed in public, whether classified information was discussed in common areas, how Mar A Lago guests and workers are vetted to screen out security risks and what security protocols are in place at the public resort.

18 U.S. Code § 793 makes it a federal crime to carelessly handle classified information.

A copy of Chaffetz's letter is below.



Ryan: Trump made right decision to seek Flynn resignation

U.S. Speaker of the House Paul Ryan (L) talks with U.S. Senate Majority Leader Mitch McConnell (R) as they wait to hear U.S. President Donald Trump's announcement of his nominee for the empty associate justice seat at the U.S. Supreme Court, at the White House in Washington,...REUTERS/Carlos Barria

WASHINGTON (Reuters) - U.S. House of Representatives Speaker Paul Ryan said on Tuesday President Donald Trump was right to seek the resignation of Michael Flynn after disclosures the national security adviser misled the vice president and others about his conversations with a Russian diplomat.

Ryan said he would leave it to the administration to explain the circumstances behind Flynn's departure.

"I think they key is this: that as soon as this person lost the president's trust, the president asked for his resignation, and that was the right thing to do," Ryan told reporters.

 (Reporting by Doina Chiacu Editing by W Simon)

U.S. House Intelligence chairman questions leaks behind Flynn resignation

FILE PHOTO: Russian President Vladimir Putin (R) sits next to retired U.S. Army Lieutenant General Michael Flynn (L) as they attend an exhibition marking the 10th anniversary of RT (Russia Today) television news channel in Moscow, Russia, December 10, 2015. Sputnik/Mikhail Klimentyev/Kremlin via REUTERS

WASHINGTON (Reuters) - The head of the U.S. House Intelligence Committee said he is concerned about leaks regarding Michael Flynn, President Donald Trump's former national security adviser, and his contacts with Russia that promoted Flynn's resignation, CNN reported on Tuesday.

House Permanent Select Committee on Intelligence Chairman Devin Nunes told reporters that he wants to look into the leaks regarding Flynn and his December call with the Russian ambassador to the United States before Trump took office, according to CNN.

 (Reporting by Susan Heavey Editing by W Simon)

FULL TEXT of Trump National Security Adviser Mike Flynn's resignation letter

FILE PHOTO: Russian President Vladimir Putin (R) sits next to retired U.S. Army Lieutenant General Michael Flynn (L) as they attend an exhibition marking the 10th anniversary of RT (Russia Today) television news channel in Moscow, Russia, December 10, 2015. Sputnik/Mikhail Klimentyev/Kremlin via REUTERS

In the course of my duties as the incoming National Security Advisor, I held numerous phone calls with foreign counterparts, ministers, and ambassadors. These calls were to facilitate a smooth transition and begin to build the necessary relationships between the President, his advisors and foreign leaders. Such calls are standard practice in any transition of this magnitude.

Unfortunately, because of the fast pace of events, I inadvertently briefed the Vice President Elect and others with incomplete information regarding my phone calls with the Russian Ambassador. I have sincerely apologized to the President and the Vice President, and they have accepted my apology.

Throughout my over thirty three years of honorable military service, and my tenure as the National Security Advisor, I have always performed my duties with the utmost of integrity and honesty to those I have served, to include the President of the United States.

I am tendering my resignation, honored to have served our nation and the American people in such a distinguished way.

I am also extremely honored to have served President Trump, who in just three weeks, has reoriented American foreign policy in fundamental ways to restore America's leadership position in the world.

As I step away once again from serving my nation in this current capacity, I wish to thank President Trump for his personal loyalty, the friendship of those who I worked with throughout the hard fought campaign, the challenging period of transition, and during the early days of his presidency.

I know with the strong leadership of President Donald J. Trump and Vice President Mike Pence and the superb team they are assembling, this team will go down in history as one of the greatest presidencies in U.S. history, and I firmly believe the American people will be well served as they all work together to help Make America Great Again.

Michael T. Flynn, LTG (Ret)

Assistant to the President / National Security Advisor

Russia defends Flynn, says he was forced to resign to damage Russia-U.S. ties


MOSCOW (Reuters) - A senior Russian lawmaker said on Tuesday it was clear that  U.S. President Donald Trump's national security adviser, Michael Flynn, had been forced to resign in an effort to damage relations between Russia and the United States.

Flynn resigned late on Monday after revelations he had discussed U.S. sanctions on Russia with the Russian ambassador to the United States before Trump took office and misled Vice President Mike Pence about the conversations.

"It's obvious that Flynn was forced to write the letter of resignation under a certain amount of pressure," Leonid Slutsky, head of the lower house of parliament's foreign affairs committee, was quoted as saying by the RIA news agency.

"The target was Russia-U.S. relations, undermining confidence in the new U.S. administration. We'll see how the situation develops further," he said.

 (Reporting by Alexander Winning; Writing by Alessandra Prentice; Editing by Andrew Osborn)

PHOTOS Trump national security aide Flynn resigns over Russian contacts

National security adviser General Michael Flynn delivers a statement daily briefing at the White House in Washington U.S., February 1, 2017. REUTERS/Carlos Barria

White House National Security Advisor Michael Flynn (C) arrives prior to a joint news conference between Canadian Prime Minister Justin Trudeau and U.S. President Donald Trump at the White House in Washington, U.S., February 13, 2017. REUTERS/Carlos Barria

National security adviser General Michael Flynn arrives to deliver a statement during the daily briefing at the White House in Washington U.S., February 1, 2017. Picture taken February 1, 2017. REUTERS/Carlos Barria

FILE PHOTO: Russian President Vladimir Putin (R) sits next to retired U.S. Army Lieutenant General Michael Flynn (L) as they attend an exhibition marking the 10th anniversary of RT (Russia Today) television news channel in Moscow, Russia, December 10, 2015. Sputnik/Mikhail Klimentyev/Kremlin via REUTERS
By Steve Holland and John Walcott

WASHINGTON (Reuters) - President Donald Trump's national security adviser, Michael Flynn, resigned late on Monday after revelations that he had discussed U.S. sanctions on Russia with the Russian ambassador to the United States before Trump took office and misled Vice President Mike Pence about the conversations.

Flynn's resignation came hours after it was reported that the Justice Department had warned the White House weeks ago that Flynn could be vulnerable to blackmail for contacts with Russian ambassador Sergey Kislyak before Trump took power on Jan. 20.

Flynn's departure was a sobering development in Trump's young presidency, a 24-day period during which his White House has been repeatedly distracted by miscues and internal dramas.

The departure could slow Trump's bid to warm up relations with Russian President Vladimir Putin.

Flynn submitted his resignation hours after Trump, through a spokesman, pointedly declined to publicly back Flynn, saying he was reviewing the situation and talking to Pence.

Flynn had promised Pence he had not discussed U.S. sanctions with the Russians, but transcripts of intercepted communications, described by U.S. officials, showed that the subject had come up in conversations between him and the Russian ambassador.

Such contacts could potentially be in violation of a law banning private citizens from engaging in foreign policy, known as the Logan Act.

Pence had defended Flynn in television interviews and was described by administration officials as upset about being misled.

"Unfortunately, because of the fast pace of events, I inadvertently briefed the vice president-elect and others with incomplete information regarding my phone calls with the Russian ambassador. I have sincerely apologized to the president and the vice president, and they have accepted my apology," Flynn said in his resignation letter.

Retired General Keith Kellogg, who has been chief of staff of the White House National Security Council, was named the acting national security adviser while Trump determines who should fill the position.

Kellogg, retired General David Petraeus, a former CIA director, and Robert Harward, a former deputy commander of U.S. Central Command, are under consideration for the position, a White House official said. Harward was described by officials as the leading candidate.

A U.S. official confirmed a Washington Post report that Sally Yates, the then-acting U.S. attorney general, told the White House late last month that she believed Flynn had misled them about the nature of his communications with the Russian ambassador.

She said Flynn might have put himself in a compromising position, possibly leaving himself vulnerable to blackmail, the official said. Yates was later fired for opposing Trump's temporary entry ban for people from seven mostly Muslim nations.

CHANGE LESS LIKELY?

A U.S. official, describing the intercepted communications, said Flynn did not make any promises about lifting the sanctions.

But he did indicate that sanctions imposed by President Barack Obama on Russia for its Ukraine incursion "would not necessarily carry over to an administration seeking to improve relations between the U.S. and Russia," the official said.

Flynn, a retired U.S. Army lieutenant general, was an early supporter of Trump and shares his interest in shaking up the establishment in Washington. He frequently raised eyebrows among Washington's foreign policy establishment for trying to persuade Trump to warm up U.S. relations with Russia.  

A U.S. official said Flynn's departure, coupled with Russia's aggression in Ukraine and Syria and Republican congressional opposition to removing sanctions on Russia, removes Trump's most ardent advocate of taking a softer line toward Putin.

Flynn's leaving "may make a significant course change less likely, at least any time soon," the official said.

Another official said Flynn's departure may strengthen the hands of some cabinet secretaries, including Defense Secretary Jim Mattis and Secretary of State Rex Tillerson.

However, the second official said, Flynn's exit could also reinforce the power of presidential aides Steve Bannon and Stephen Miller, whom he described as already having the president's ear.

Congressional Democrats expressed alarm at the developments  surrounding Flynn and called for a classified briefing by administration officials to explain what had happened.

"We are communicating this request to the Department of Justice and FBI this evening," said Democratic representatives John Conyers of Michigan and Elijah Cummings of Maryland.

U.S. Representative Adam Schiff of California, ranking Democrat on the House Permanent Select Committee on Intelligence, said Flynn's departure does not end the questions over his contacts with the Russians.

"The Trump administration has yet to be forthcoming about who was aware of Flynn's conversations with the ambassador and whether he was acting on the instructions of the president or any other officials, or with their knowledge," Schiff said.

The committee's chairman, Republican Devin Nunes, thanked Flynn for his service.

"Washington D.C. can be a rough town for honorable people, and Flynn — who has always been a soldier, not a politician —deserves America's gratitude and respect," he said.  



 (Additional reporting by Emily Stephenson; Editing by Peter Cooney, Robert Birsel)

Cut off Government Funds to Universities? Of Course.


Milo Yiannopoulos, the controversial and polarizing poster boy of the alt-right, was scheduled to speak at the University of California at Berkeley last week. However, thanks to destructive riots that resulted in almost $100,000 in damages, the event was canceled just hours before it was due to begin.
As expected, President Trump had strong opinions about the incident, which he made publicly known on his Twitter account.


Threatening to cut almost $500 million in federal funding, Trump chastised the historic California university for canceling the event and accused its administration of obstructing the First Amendment right to free speech.

But notice: this suggestion comes as a threat, as punishment for failing to control protesters, the withdrawal of a subsidy as a punitive measure. This is not the way to achieve what we desperately need: cutting off all federal funds for universities as a matter of fiscal soundness and the principle of freedom itself.

Cut them Off!

Whether he realizes it or not—and it is almost certain that he does not—President Trump’s statement provided a compelling case for ending federal funding to all institutions of higher education.

One of the many problematic issues with federal funding is the tendency of politicians to use it as a bargaining chip against the opposition.

Partisan politics can turn ugly rather quickly, which is why budget cuts are often perceived as punishments rather than sensible economic decisions. As the saying goes, “he who holds the purse strings holds the power.”

Unfortunately, federal funding is almost always used as a means to force compliance from those receiving the financial aid. Institutions that choose to accept this money are soon likely to discover that they are required to adhere to certain stipulations that might not otherwise have been agreed to.
The Common Core standards, for example, were pushed onto the states through a federal stimulus package. Once this federal money was accepted, the states were required to adopt a curriculum that met certain standards.
Conveniently enough, the government was waiting in the wings with a ready-made plan that accomplished this goal. If states refused to comply, the federal money was retracted.

Luckily, private institutions are not subject to the same rules as the public sector. For those organizations that operate solely on private funds, it is much more difficult for the federal government to interfere, although not impossible.

If, for example, the student body was opposed to the idea of hosting a speaker they strongly disagreed with, a private university would have every right to deny that speaker access to campus facilities.
However, so long as federal funding is given and received by institutions of higher education, campuses have little to no recourse when it comes to censoring certain individuals on campus.
While President Trump does not actually have the authority to cut federal funding from U.C. Berkeley, every threat, substantial or not, comes with a hurricane of hysteria and fear over what the new president may do.

The only way to really stay autonomous without binding yourself to federal conditions is to simply stop accepting – and stop offering – this money altogether.

Brittany Hunter
Brittany Hunter
Brittany Hunter is an associate editor at FEE.
This article was originally published on FEE.org. Read the original article.

StingRay Is Exactly Why the 4th Amendment Was Written

Photo: EFF, CC by 3.0
Imagine you are in the middle of your typical day-to-day activities. Maybe you are driving, spending time with family, or working. If you are like most people, your phone is at your side on a daily basis. Little do you know that, at any time, police and law enforcement could be looking at information stored on your phone. You haven't done anything wrong. You haven't been asked for permission. You aren't suspected of any crime.

The StingRay


Police have the power to collect your location along with the numbers of your incoming and outgoing calls and intercept the content of call and text communication. They can do all of this without you ever knowing about it.

How? They use a shoebox-sized device called a StingRay. This device (also called an IMSI catcher)
mimics cell phone towers, prompting all the phones in the area to connect to it even if the phones aren't in use.

The police use StingRays to track down and implicate perpetrators of mainly domestic crimes. The devices can be mounted in vehicles, drones, helicopters, and airplanes, allowing police to gain highly specific information on the location of any particular phone, down to a particular apartment complex or hotel room.


Quietly, StingRay use is growing throughout local and federal law enforcement with little to no oversight. The ACLU has discovered that at least 68 agencies in 23 different states own StingRays, but says that this "dramatically underrepresents the actual use of StingRays by law enforcement agencies nationwide."


The Violation


Information from potentially thousands of phones is being collected every time a StingRay is used. Signals are sent into the homes, bags, and pockets of innocent individuals. The Electronic Frontier Foundation likens this to the Pre-Revolutionary War practice of soldiers going door-to-door, searching without suspicion.

Richard Tynan, a technologist with Privacy International notes that, “there really isn’t any place for innocent people to hide from a device such as this.”


The Fourth Amendment of the Constitution states that, “the right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no warrants shall issue, but upon probable cause, supported by oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”


The StingRay clearly violates these standards. The drafters of the Constitution recognized that restricting the government from violating privacy is essential for a free society. That's why the Fourth Amendment exists. The StingRay is creating a dangerous precedent that tells the government that it's okay for them to violate our rights. Because of this, freedom is quietly slipping out the window.


Little Regulation


Law Enforcement is using StingRays without a warrant in most cases. For example, the San Bernardino Police Department used their StingRay 300 times without a warrant in a little over a year.

In 2010, the Tallahassee Police Department used a StingRay in a warrantless search to track down the suspect of a crime. A testimony from an unsealed hearing transcript talks about how police went about finding their target. The ACLU sums it up well:
"Police drove through the area using the vehicle-based device until they found the apartment complex in which the target phone was located, and then they walked around with the handheld device and stood ‘at every door and every window in that complex’ until they figured out which apartment the phone was located in. In other words, police were lurking outside people’s windows and sending powerful electronic signals into their private homes in order to collect information from within."
A handful of states have passed laws requiring police and federal agents to get a warrant before using a StingRay. They must show probable cause for one of the thousands of phones that they are actually searching. This is far from enough.

Additionally, there are many concerns that agents are withholding information from federal judges to monitor subjects without approval - bypassing the probable cause standard laid out in the Constitution. They even go as far as to let criminals go to avoid disclosing information about these devices to the courts.


If the public doesn’t become aware of this issue, the police will continue to use StingRays to infringe on our rights in secret and with impunity.

Olivia Donaldson
Olivia Donaldson
Olivia Donaldson is a recent high school graduate that is currently opting out of college and participating in an entrepreneurial program called Praxis.
This article was originally published on FEE.org. Read the original article.

Jeff Sessions and the Thuggery of Asset Forfeiture

One of the unfortunate features of Washington is that people often wind up in places that bring out their worst behaviors.

The classic example is Jack Kemp, who did great work as a member of Congress to push a supply-side agenda of low marginal tax rates and less double taxation. Indeed, it’s no exaggeration to say that the Reagan tax cuts were made possible by Kemp’s yeoman efforts. But when President George H.W. Bush brought Kemp into his cabinet back in 1989, it wasn’t to head up the Treasury Department. It was to be Secretary of Housing and Urban Development, a department that shouldn’t even exist. And because Kemp was weak on spending issues, he predictably and unfortunately presided over an expansion of HUD’s budget. If he was at Treasury, by contrast, he may have been able to stop Bush’s disastrous read-my-lips tax deal.

Another example is that Republicans members of Congress from farm states generally favor small government. So if they wind up on committees that deal with overall fiscal issues, they usually are allies in the effort to restrain Leviathan. Unfortunately, they more often wind up on the Agriculture Committee, which means they accumulate power and expertise in the area where they are least likely to favor free markets and limited government. They net effect is that they may still have a decent voting record, but their actual impact on public policy will be harmful. The same thing happens with Republicans who get on the transportation committees.

Today’s example is Attorney General Jeff Sessions. When he was Chairman of the Senate Budget Committee, he was an ally in the fight against big government. He favored decentralization. He supported rolling back the welfare state. He favored entitlement reform. He supported tax cuts. He used his power and position to try to do the right thing. But when Trump asked Sessions to join his cabinet, it wasn’t to head the Office of Management and Budget, a position that would have been a good fit. Instead, Trump picked him to be Attorney General, which is problematical because Sessions is an advocate of the failed War on Drugs. And he’s also a supporter of “asset forfeiture,” which occurs when governments steal money and property from citizens without convicting them of any crime. Or sometimes without even charging them with a crime.



I’m not joking. This happens with distressing regularity. It’s called “policing for profit.”

In poor nations, a corrupt cop will stop motorists to shake them down for pocket change. In the United States, we’ve legalized a bigger version of that sleazy behavior. George Will shared a reprehensible example last December.
The Sourovelises’ son, who lived at home, was arrested for selling a small amount of drugs away from home. Soon there was a knock on their door by police who said, “We’re here to take your house” and “You’re going to be living on the street” and “We do this every day.” The Sourovelises’ doors were locked with screws and their utilities were cut off. They had paid off the mortgage on their $350,000 home, making it a tempting target for policing for profit. Nationwide, proceeds from sales of seized property (homes, cars, etc.) go to the seizers. And under a federal program, state and local law enforcement can partner with federal authorities in forfeiture and reap up to 80 percent of the proceeds. This is called — more Orwellian newspeak — “equitable sharing.” No crime had been committed in the Sourovelises’ house, but the title of the case against them was “Commonwealth of Pennsylvania v. 12011 Ferndale Street.” Somehow, a crime had been committed by the house. In civil forfeiture, it suffices that property is suspected of having been involved in a crime. Once seized, the property’s owners bear the burden of proving their property’s innocence.
The good news is that there’s a growing desire to stop governments from stealing.
Indeed, Will points out that there was “a 2015 Senate Judiciary Committee hearing on forfeiture abuses.”

Unfortunately, not everybody at the hearing agreed that it’s wrong for governments to arbitrarily engage in theft.
…one senator said “taking and seizing and forfeiting, through a government judicial process, illegal gains from criminal enterprises is not wrong,” and neither is law enforcement enriching itself from this. …this senator asserted an unverifiable number: “Ninety-five percent” of forfeitures involve people who have “done nothing in their lives but sell dope.” This senator said it should not be more difficult for “government to take money from a drug dealer than it is for a businessperson to defend themselves in a lawsuit.” In seizing property suspected of involvement in a crime, government “should not have a burden of proof higher than in a normal civil case.”
The Senator who made these statements was Jeff Sessions.

And, as George Will explains, the then-Senator missed a few points.
In civil forfeiture there usually is no proper “judicial process.” There is no way of knowing how many forfeitures involve criminals because the government takes property without even charging anyone with a crime. The government’s vast prosecutorial resources are one reason it properly bears the burden of proving criminal culpability “beyond a reasonable doubt.” A sued businessperson does not have assets taken until he or she has lost in a trial, whereas civil forfeiture takes property without a trial and the property owner must wage a protracted, complex, and expensive fight to get it returned.
The Wall Street Journal also opined about the new Attorney General’s indefensible position.
The all-too-common practice allows law enforcement to take private property without due process and has become a cash cow for state and local police and prosecutors. …Assets are often seized—and never returned—without any judicial process or court supervision. Unlike criminal forfeiture, civil forfeiture doesn’t require a criminal conviction or even charges. According to the Virginia-based Institute for Justice, which tracks forfeitures, 13% of all forfeitures done by the Justice Department between 1997 and 2013 were in criminal cases while 87% were civil forfeitures. And 88% of those forfeitures were done by an administrative agency, not a court. …The lack of procedural protection coupled with financial incentives has turned policing for profit into a slush fund for governments hungry for cash, and the payouts too often come at the expense of civil liberties. We’d like to hear what Mr. Sessions thinks of the practice today.
Sadly, it doesn’t appear that President Trump is on the right side either.

In a new column on the topic, George Will addresses this unfortunate development.
There is no reason for the sheriffs to want to reform a racket that lines their pockets. For the rest of us, strengthening the rule of law and eliminating moral hazard are each sufficient reasons. Civil forfeiture is the power to seize property suspected of being produced by, or involved in, crime. If property is suspected of being involved in criminal activity, law enforcement can seize it. Once seized, the property’s owners bear the burden of proving that they were not involved in such activity, which can be a costly and protracted procedure. So, civil forfeiture proceeds on the guilty-until-proven-innocent principle. Civil forfeiture forces property owners, often people of modest means, to hire lawyers and do battle against a government with unlimited resources. And here is why the sheriffs probably purred contentedly when Trump endorsed civil forfeiture law — if something so devoid of due process can be dignified as law: Predatory law enforcement agencies can pocket the proceeds from the sale of property they seize.
The folks at Reason have a new video on Trump’s support for theft-by-government.



By the way, I hold out some hope that Trump may not be completely bad on the issue. It’s possible that he’s never considered the issue and doesn’t understand that it involves over-the-top government thuggery. He may simply think it’s some sort of procedural issue involving good cops against bad crooks.

So perhaps when he is briefed on what the issue really means, he’ll be in favor of protecting Americans from the kind of horrible abuse that the Dehko family experienced. Or the mistreatment of Carole Hinders. Or the ransacking of Joseph Rivers. Or the brutalization of Thomas Williams.

I could continue, but I think you get the point.

Let’s close, though, with some good news. I wrote two years ago about the case of Charles Clarke, who had $11,000 that was stolen by government. Thanks to the Institute for Justice, that stolen money has been returned.
Charles Clarke, the college student who was robbed of $11,000 in cash by cops at the Cincinnati/Northern Kentucky International Airport two years ago, will get his money back with interest under an agreement he reached with the Justice Department this week. …To keep the money, the government theoretically had to show that it more likely than not came from selling drugs or was intended to buy them. But that burden applied only if Clarke had the means to challenge the forfeiture once the government had taken his savings. Innocent owners often find that standing up for their rights costs more than the value of the property they are trying to get back. Luckily for Clarke, he had the Institute for Justice in his corner.
And the other bit of good news is that New Mexico has curtailed the disgusting practice of asset forfeiture. Hopefully Trump won’t try to destroy the careers of the lawmakers who decided the Constitution was more important than lining the pockets of the bureaucracy.

Republished from International Liberty.
Daniel J. Mitchell
Daniel J. Mitchell
Daniel J. Mitchell is a senior fellow at the Cato Institute who specializes in fiscal policy, particularly tax reform, international tax competition, and the economic burden of government spending. He also serves on the editorial board of the Cayman Financial Review.
This article was originally published on FEE.org. Read the original article.

Ted Cruz’s Take on Obamacare, in 4 Quotes


In a prime-time debate on CNN, Sens. Bernie Sanders, I-Vt., and Ted Cruz, R-Texas, discussed “The Future of Obamacare” in America. Cruz, a leading critic of the law, used the moment to outline the law’s failures.

Here are four things Cruz said about Obamacare:

1)  “Now, nobody thinks we’re done once Obamacare is repealed. Once Obamacare is repealed, we need commonsense reform that increases competition, that empowers patients, that gives you more choices, that puts you in charge of your health care, rather than empowering government bureaucrats to get in the way. And these have been commonsense ideas.”

2) “Indeed, I don’t know if the cameras can see this, but in 70 percent of the counties in America, on Obamacare exchanges, you have a choice of one or two health insurance plans, that’s it … It’s interesting. You look at this map, this also very much looks like the electoral map that elected Donald Trump. It’s really quite striking that the communities that have been hammered by this disaster of a law said enough already.”

During one of the more powerful moments in the debate, Cruz held up a Heritage Foundation chart showing viewers how many counties in the U.S. have access to only one or two insurers under Obamacare. Additionally, only 11 percent of counties have access to four or more insurance providers.

3) “Whenever you put government in charge of health care, what it means is they ration. They decide you get care and you don’t. I don’t think the government has any business telling you you’re not entitled to receive health care.”

The U.S. should not envy other health care systems, especially Canada and the United Kingdom, Cruz said. He referred to a governor from Canada who came to the U.S. specifically to have heart surgery.

4) “That’s why I think the answer is not more of Obamacare, more government control, more of what got us in this mess. Rather, the answer is empower you. Give you choices. Lower prices. Lower premiums. Lower deductibles. Empower you and put you back in charge of your health care.”

Obamacare is burdening Americans. The average deductible for a family on a bronze plan is $12,393, according to a HealthPocket analysis. According to an eHealth report, the average nationwide premium increase for individuals is 99 percent and 140 percent for families from 2013-2017.

Report by Morgan Walker (@morgan_walker95). Originally published at The Daily Signal.

How Econ Textbooks Sanitize the Horrors of Communism

When I was first learning economics, I was surprised by how pro-communist many economics textbooks were. I don't mean, of course, that any economics textbook ever said, "Communism is good." What I mean, rather, is that textbooks were very positive relative to communism's historical record. Indeed, many seemed deeply ignorant of actual communism, basing their assessment on second-hand information about communists' stated intentions, plus a few anecdotes about inefficiencies. Many textbook authors were, in a phrase, communist dupes: Non-communists who believe and spread a radically overoptimistic image of communism.
At least that's what my admittedly flawed memory says.

Today's Texts


This homeschool year, I'm prepping my sons for the Advanced Placement tests in Microeconomics and Macroeconomics. Our primary text is Cowen and Tabarrok, which includes accurately horrifying details about life under communism. But we're also working through all the test prep books. And while skimming the Princeton Review's Cracking the AP Economics, bad textbook memories came flooding back to me. It's mostly a normal econ text, but here's what it tells us about communism:
Communism is a system designed to minimize imbalance in wealth via the collective ownership of property. Legislators from a single political party – the communist party – divide the available wealth for equal advantage among citizens. The problems with communism include a lack of incentives for extra effort, risk taking, and innovation. The critical role of the central government in allocating resources and setting production levels makes this system particularly vulnerable to corruption.
Is this passage really so awful? Yes. Let's dissect it sentence-by-sentence.
Communism is a system designed to minimize imbalance in wealth via the collective ownership of property.
Communist regimes generally had low measured inequality, but collective ownership of property was never primarily a means of "minimizing wealth imbalance." The official communist line was that collective ownership would lead to high economic growth – and ultimately cornucopia. And in practice, communist regimes made collective ownership an end in itself. Just look at their repeated farm collectivizations that caused horrifying famines in the short-run, and low agricultural productivity in the long-run. You wouldn't keep doing this unless you valued collective ownership for its own sake.
Legislators from a single political party – the communist party – divide the available wealth for equal advantage among citizens.
What actually happened under communism was rather different. Communist regimes began with the mass murder of their political enemies, businessmen, and their families. Next, they seized the peasants' land, leading to hellish famines. In time, they launched major "industrialization" campaigns but obsessively focused on building up their militaries, not mass consumption. And no communist regime has ever tried to "divide wealth for equal advantage." Bloodbaths aside, communist regimes always put Party members' comfort above the very lives of ordinary citizens.
The problems with communism include a lack of incentives for extra effort, risk taking, and innovation.
Communist regimes did provide poor incentives to produce consumer goods for ordinary citizens. But they provided solid to excellent incentives in the sectors they really cared about: the military, secret police, border guarding, athletics, space programs, and so on.
The critical role of the central government in allocating resources and setting production levels makes this system particularly vulnerable to corruption.
Talk about praising with faint damnation. Never mind mass murder, famine, pathological militarism, and state-mandated favoritism for Party members. What's really telling is that communism was "particularly vulnerable to corruption."

Cracking
Defenders


A defender of Cracking the AP Economics could protest, "It's talking about the idea of communism, not the practice of Communism." But re-read the passage. There's nothing in the idea of communism that makes it "vulnerable to corruption." This is clearly a complaint about how communism really worked – and it leaves students with the impression that corruption was communism's chief defect.

A more reasonable response would be, "This passage is terrible but unrepresentative. I dare you to find five similarly credulous evaluations of communism in other textbooks." I strongly suspect I can meet this challenge; plenty of textbook authors, past and present, were probably communist dupes. But for now, I'm too busy to meet this challenge. Feel free to share evidence – or counter-evidence – in the comments.

Bryan Caplan
Bryan Caplan
Bryan Caplan is a professor of economics at George Mason University, research fellow at the Mercatus Center, adjunct scholar at the Cato Institute, and blogger for EconLog. He is a member of the FEE Faculty Network.
This article was originally published on FEE.org. Read the original article.

George Soros, Mastercard to partner to aid migrants, refugees

NEW YORK (Reuters) - Billionaire investor George Soros will partner with Mastercard Inc on a venture they said could help migrants, refugees and others struggling within their communities worldwide to improve their economic and social status.

The partnership, Humanity Ventures, stems from a pledge Soros made in September to earmark up to $500 million for investments to address challenges facing migrants and refugees. 

In a joint statement on Thursday, Mastercard and Soros said that despite billions of dollars of humanitarian and development assistance, millions of people remain marginalized, a situation the private sector can help rectify.

“Migrants are often forced into lives of despair in their host communities because they cannot gain access to financial, healthcare and government services," Soros said.

"Our potential investment in this social enterprise, coupled with Mastercard's ability to create products that serve vulnerable communities, can show how private capital can play a constructive role in solving social problems," he added.    

Humanity Ventures intends to focus initially on healthcare and education, with a goal of fostering local economic development and entrepreneurship.

With the creation of Humanity Ventures, Soros could invest up to $50 million to make these solutions more scalable and sustainable, and perhaps encourage smaller projects committed to mitigating the migration crisis.

"Humanity Ventures is intended to be profitable so as to stimulate involvement from other businesspeople," Soros said. "We also hope to establish standards of practice to ensure that investments are not exploitative of the vulnerable communities we intend to serve."

Soros opened his first foundation, the Open Society Foundations, in 1979 when his hedge fund had reached about $100 million and his personal wealth had climbed to about $25 million.

Just last week, Soros' Open Society Foundations said it will keep working with and financing organizations in Hungary despite the government saying that any civil society group should be "swept out." 

 (Reporting by Jennifer Ablan; Editing by Lisa Shumaker)