Category: Uncategorized

Jacoby for Washington Monthly: Germany’s Rearmament Is Stunning

Posted on by Alex Terr

The sign in the window of the German army’s storefront career center in downtown Berlin suggested it would be open all afternoon for inquiries about joining the armed forces, or Bundeswehr. But the doors were locked on a cold November day, with no lights on and no one inside. The same was true the next day when I tried again. “What kind of message does that send?” my friend, a former soldier who accompanied me, asked scornfully. “It’s like so much about the Bundeswehr these days—underfunded, undermanned, underequipped, and undervalued by the public, which still doesn’t really understand why Germany needs an army.”

Eighty years after the end of World War II, as Russia escalates attacks against Europe and the U.S. threatens to turn away from the transatlantic alliance, Germany is undergoing a historic shift. In 2022, then-Chancellor Olaf Scholz called it a Zeitenwende—a “watershed moment”—and mandated a one-off infusion of €100 billion in defense spending, nearly doubling Germany’s previous annual allocation. The first thing his successor, Friedrich Merz, did after being elected last year was to amend the constitution’s “brake” on borrowing to pay for weapons and ammunition. Germany is now on track to spend €650 billion on the military over the next five years, more than doubling the amount disbursed in the previous five years.

Just days before I visited that closed army career center, Merz’s coalition government agreed to a new conscription law that could double the number of men ready to fight, growing the Bundeswehr from 180,000 to 260,000 soldiers and building the reserve force to 200,000. (Women aren’t required to comply with the new requirements but may volunteer.)

There is no longer any doubt that Germany is broadly committed to rearmament. A prospect that might once have provoked anxiety in Europe and North America is now broadly welcomed in the West. But that doesn’t make it easy for the German people, shaped by decades of post-World War II pacifism.

Read more in Washington Monthly. 

The Trump administration is not protecting freedom of speech

Posted on by Alex Terr

FACT: The Trump administration is not protecting freedom of speech.

THE NUMBERS: Some people denied U.S. visas –

People Year
Thierry Breton,Anna-Lena von Hollenberg, Josephine Ballon, Clare Melford, Imran Ahmed   December 2025
Wole Soyinka       October 2025
Patricia Lara 1986
Dario Fo 1980
John Lennon 1972
Gabriel Garcia Marquez 1971
Miriam Makeba 1968
Carlos Fuentes 1962
Charles Chaplin 1950
Pablo Neruda 1946

WHAT THEY MEAN: 

Thomas Jefferson’s Second Inaugural calls for confidence in truth, the weakness of error and deceit, and the public’s capacity to reason — given freedom of speech — from facts informed by principles to a correct judgment:

“Since truth and reason have maintained their ground against false opinions in league with false facts … the public judgment will correct false reasonings and opinions on a full hearing of all parties.”

In this age of troll farms, programmed bots, “influencers” subsidized by unfriendly powers, and other disinformation ops, sticking with Jefferson’s idealism takes nerve. The Trump administration hasn’t got it:  Over the holidays, its State Department banned five citizens of U.S. allies — a former EU Commissioner and four digital-monitor NGO officers — from entering the United States, based essentially on claims that they talk too much and say unwelcome things. A rundown, then some thoughts:

France: Thierry Breton, the former EU Commissioner for the Internal Market, because in 2024 he “ominously reminded [Twitter owner] Elon Musk of @X’s legal obligations” under the European Union’s Digital Services Act.

United Kingdom: Clare Melford of Global Disinformation Index, apparently for involvement in Canadian controversies over Native American residential schools. Imran Ahmed of the Center for Countering Digital Hate gets a flag too, as a “key collaborator with the Biden administration’s effort [ed. note: non-existent] to weaponize the government against U.S. citizens,” for example, by publishing a list of 12 prominent anti-vaccine sites and their leaders, one of whom now has a Trump admin. job.

Germany: Anna-Lena von Hollenberg and Josephine Ballon of HateAid, a “digital watchdog” NGO based in Berlin, both of whom “cited threat of ‘disinformation’ from ‘right-wing extremists online’” and “support the U.K.’s Online Safety Act and EU’s Digital Services Act.”

In sum: An ex-EU official reminds a company of legal obligations (even if the law in question, in the PPI view, isn’t a very good one); an NGO works in good faith with a U.S. administration to identify and publicize disinformation ops; another lists anti-vaxx groups; a third gets involved in intra-Canadian disputes. The Department says that these (a) amount to an effort to “coerce U.S. platforms to censor, demonetize, and suppress American viewpoints”, and that (b) the five individuals’ “entry, presence, or activities in the United States” therefore “have potentially serious adverse foreign policy consequences [ed. note: none specified] for the United States,” (c) making the visa bans a way to “combat” a “global censorship-industrial complex.”

What to say about this? The Trump administration isn’t in general much of a free-speech defender. At home, the White House, the Federal Communications Commission, the Departments of Justice, Education, Defense, etc., and other agencies all frequently threaten to withdraw U.S. media companies’ broadcast licenses for unfavorable press coverage, accuse Members of Congress of “sedition” for the obviously correct statement that American soldiers must refuse illegal orders, sue overseas journalists, try to micro-manage university curricula, etc. Looking abroad, December’s visa decisions are more in a series of decisions meant to show petulance and hostility toward America’s European allies, but the Europeans aren’t the only targets. A few weeks earlier in October, the administration reanimated a particularly unfortunate Cold War policy — keeping artists and writers with inconvenient or objectionable opinions out of the U.S. — by canceling the visa of 91-year-old Nigerian Nobelist Wole Soyinka, apparently to express resentment for Soyinka’s unflattering comparison of Mr. Trump to the late Ugandan president Idi Amin.

None of this, of course, means that NGO critiques of U.S. platforms are always right, nor that the administration is invariably wrong. But the U.S. and the European democracies are certainly targets of disinformation campaigns. Governments ought to be cooperating to expose and counter them, and it’s good that British and German NGOs are trying – very much in Jefferson’s spirit of trying to provide the public a “full hearing” – to identify and publicize their origins and objectives.  They sometimes do miss, and they may at times wrongly blame ‘platforms’ for larger policy problems.  But the appropriate response is to provide accurate facts and let the public decide, not try to stop Americans from hearing them.  And as to “serious adverse foreign policy consequences,” that looks like just blather.  The administration’s real complaint seems to be about the expression of opinions and factual points that it, or some of its friends, dislikes hearing. In any such case, Jefferson remains the right guide.

FURTHER READING

PPI’s four principles for response to tariffs and economic isolationism:

  • Defend the Constitution and oppose rule by decree;
  • Connect tariff policy to growth, work, prices and family budgets, and living standards;
  • Stand by America’s neighbors and allies;
  • Offer a positive alternative.

Sec. Rubio announces visa bans, claims to be battling a “global censorship-industrial complex.”

… and Undersecretary of State Rogers tries to explain the particulars.

From the Monticello Foundation, Jefferson’s view that the truth is strong enough to defend itself.

… and the full Second Inaugural text.

More:

M. Breton’s European Commission bio.

… and a comment from Le Monde.

Homepages for HateAid, the Center for Countering Digital Hate, and the Global Disinformation Index.

“First as tragedy, then as farce”:

Then:

The Cold War-era visa denials, in contrast to the contemporary Soyinka case, usually at least reflected some sort of dispute over state policy or ideology, though in retrospect (and to lots of people at the time) they didn’t reflect well on the U.S. government. Typical examples: John Lennon for anti-war activism, Miriam Makeba for involvement in the U.S. “Black Power” movement, Gabriel García Márquez for sympathy for left-wing revolutionary movements, and Dario Fo for philosophical anarchism.

NPR looks back at the Nixon administration’s unsuccessful attempt to expel Lennon.

American Theater comments on the Dario Fo case.

Now:

The BBC and Nigeria’s National Post on Soyinka’s contemporary visa denial.

… for context, Uganda’s official Idi Amin bio.

… and a topical book rec. — Soyinka’s The Burden of Memory, the Muse of Forgiveness (2000) reflects on African politics, relations with the United States and the diaspora, human rights, and reconciliation.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007). He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

Read the full email and sign up for the Trade Fact of the Week.

Manno in National Affairs: Social Capital and Opportunity

Posted on by Alex Terr

As the old saying goes, it’s not just what you know but who you know. Relationships, not just knowledge and skills, play a decisive role in helping a young person transition from the classroom to a career. This perennial truth applies doubly in today’s rapidly shifting economy. Social capital — the value embedded in personal networks, mentors, and community connections — can be the key factor in whether a graduate finds a good job or struggles to get a foot in the door. Indeed, economic opportunity is rooted in the “who-you-know” network of relationships that provide young people with information and support as they pursue their careers.

Access to these networks, however, is profoundly unequal. Young people from affluent or well-connected backgrounds often enjoy a rich social-capital web of mentors, family friends, and alumni connections ready to help them land job interviews and internships — a form of social wealth. In contrast, their peers from disadvantaged communities or first-generation college students frequently face a social-capital gap that can impede their entry into the workforce, even when they have comparable academic credentials — a form of social poverty.

Thus, it is fair to say that social capital, or the lack thereof, shapes young Americans’ workforce entry and broader life outcomes. If we want Americans from all walks of life to have more social capital and opportunity, we must first examine the role of relationships in workforce readiness. We should then consider examples of schools, colleges, and employers that are innovating to build students’ and workers’ social capital, especially among those who start with fewer connections. Such an inquiry will demonstrate to policymakers, education leaders, and workforce stakeholders why investing in social networks is vital for equality and opportunity — and how to do it.

Read more in National Affairs.

Trump Plays Warlord at America’s Expense

Posted on by Alex Terr

Now-former Venezuelan President Nicolas Maduro was a brutal dictator whose dreadful politics and policies, largely inherited from his equally autocratic predecessor Hugo Chavez, ran his country into the ground. The U.S. military operation that captured Maduro once again demonstrated the tactical and operational proficiency of the American armed forces. But neither Maduro’s autocratic governance nor the audacity and skill of the U.S. military in executing assigned tasks are the primary issue at hand here: at the whim of one man and with no real explanation or apparent rationale, the United States has launched an unwise and illegitimate military intervention that only undermines American interests and international security. 

Here are five reasons why:

A clear and overt act of war. President Trump’s kidnapping of Maduro represents unprovoked aggression against a nation that has not declared war against the United States nor engaged in hostilities against it. Maduro and his regime may be corrupt, repressive, and possess relatively minor ties to international cocaine trafficking, but in no real sense could the United States be said to have been in armed conflict with Venezuela before last weekend’s raid. President George H.W. Bush’s 1989 invasion of Panama, Operation Just Cause, does not offer a parallel: Panamanian dictator Manuel Noriega declared a state of war existed between his nation and the United States five days before the invasion; the next day, an American serviceman was killed by Panamanian military personnel. 

In short, President Trump ordered the sort of aggressive action American statesmen have sought, however imperfectly, to banish from the conduct of international affairs since at least the days of Woodrow Wilson.

Illegitimate at home and abroad. Neither consulting nor seeking support from Congress at home or relevant nations and international organizations overseas, President Trump’s Venezuela raid lacks basic domestic and international legitimacy. 

  • Unlike President George W. Bush in Iraq in 2002, he has neither sought nor received authorization from Congress to use military force against Venezuela. 
  • Unlike President Barack Obama in Libya in 2011, he has not received authorization from the United Nations Security Council for military operations in Venezuela. 
  • Unlike President Bill Clinton in Kosovo in 1999, he does not have the support of a relevant regional organization (NATO, in the Kosovo case) for his intervention. 
  • And unlike President Obama’s intervention against ISIS in Iraq and Syria in 2014, he does not have the support of Venezuela’s immediate neighbors for military operations against the Maduro regime — indeed, Trump already appears to be threatening similar interventions against neighboring Colombia and other nations in the Western Hemisphere. 

The lack of any sort of domestic or international authorization for Trump’s act of war against Venezuela isn’t just a matter of legality — though it is, of course, that as well. Neither Trump nor his administration have offered either the American public or the rest of the world much in the way of explanation or rationale for their use of force in Venezuela. (By contrast, the Bush administration spent months making a case for the invasion of Iraq to both the American people and the world.) Instead, they have displayed contempt for the principle of democracy at home and what the Declaration of Independence called “a decent respect for the opinions of mankind” abroad. 

Taking America to war on a personal whim. As with his other domestic and foreign policies — most notably tariffs — Trump has taken the United States to war on little more than his own personal whim, whittling the notion of “national security” down to meaninglessness in the process. He has, as noted, refused to make a clear or compelling case for this act of war against Venezuela to either the American people or the world, and has gone on to threaten the sovereignty of America’s ally, Denmark, and its longtime security partner, Colombia, as well as neighboring Mexico and Cuba. Trump clearly believes the U.S. military can be deployed anywhere at his own personal whim without providing any justification to anyone — he kept Congressional Democrats in the dark, for instance, about the Venezuela operation before agreeing to a briefing several days after the fact.

These are the actions and attitudes of an aspiring strongman with no respect for America’s republican principles, not a responsible political leader in a democracy. 

No plan for what’s next. The Trump administration has no apparent plan for what it aims to achieve in a post-Maduro Venezuela, making the Bush administration’s negligent post-war planning for Iraq in 2002 and 2003 look like a masterpiece of advanced preparation by comparison. Though the U.S. military had only snatched Maduro and left the “Chavista” regime that has ruled the country since 1999 largely intact, Trump proclaimed that the United States would now “run” Venezuela despite the fact that the Trump administration lacks a foreign policy apparatus beyond a few critical personnel like Secretary of State-slash-National Security Adviser Marco Rubio and peripatetic presidential special envoy Steve Witkoff. Trump himself dismissed Venezuelan opposition leader and Nobel laureate María Corina Machado as a potential Maduro successor because, according to anonymous White House officials, she accepted the Nobel Peace Prize that Trump imagines is his due.

The plan, such as it is, appears to be to threaten Venezuela’s new leadership with further military action if it does not give in to Trump’s unclear demands (which seem to include some sort of seizure of the nation’s considerable oil assets) — a gangster-style approach to foreign policy if there ever was one.

One giant leap toward a world where might makes right. Like Vladimir Putin and Xi Jinping, President Trump clearly believes the world can and should be carved up into spheres of influence to be ruthlessly dominated by great powers as they see fit, with supposedly lesser nations forced to bow to the whims of more powerful ones. His special military operation in Venezuela and subsequent threats to other Caribbean nations (to say nothing of American ally Denmark) reflect this belief — and stand in direct contradiction to the sort of world American leaders have sought to create, however fitfully, for at least the past century. As Woodrow Wilson, Franklin D. Roosevelt, and their successors understood, the law of the jungle does not make for a stable, secure, or prosperous world. 

Indeed, in Ukraine alone, the United States and its European allies have spent hundreds of billions of dollars — and some 50,000 Ukrainians have given their lives — to defend the notion of national sovereignty and the right of nations to choose their own destiny that Trump has blatantly violated in Venezuela. In effect, then, President Trump has given a green light to similar great power aggression around the world, from Putin’s war against Ukraine to a possible Chinese invasion of Taiwan and beyond.  

With his Venezuela raid, Trump has swung open the door to a world run on the principles of gangsterism — and America will come to regret it.

Manno for American Thinker: Opportunity and Social Wealth

Posted on by Alex Terr

If Adam Smith were alive today, he might be compelled to write a third book that would extend his arguments in The Theory of Moral Sentiments and An Inquiry into the Nature and Causes of the Wealth of Nations more directly to an issue Americans need to recover.

The topic would be social wealth, or the web of relationships that turns individual talent into broad-based opportunity — what sociologists today call social capital.

In today’s economy, what you know matters. But who you know — and who knows you — also matters. Both form the basis for an individual’s personal and vocational identity. All are necessary for the pursuit of opportunity. In short, Knowledge + Networks + Identity = Opportunity.

Read more in American Thinker. 

Marshall for The Hill: Republicans Are Still Clueless on Health Care

Posted on by Max Sherrill

No issue seems to befuddle Republicans more than health care. Last week, they failed for the umpteenth time to produce a convincing plan to make health coverage more affordable for working Americans.

The Republican-controlled Senate blocked a Democratic bill to extend Affordable Care Act subsidies for health insurance beefed up during the pandemic to help working families pay their premiums. The Republican alternative also failed to get enough votes to avoid a filibuster.

House Republicans this week likewise rejected bipartisan proposals to scale back and better target the premium subsidies. Instead, House Speaker Mike Johnson (R-La.) cobbled together a modest grab bag of proposals that bore scant resemblance to Senate Republicans’ bill.

Keep reading in The Hill.

Manno for Work Shift: Workforce Pell’s Stress Test: Can Faster Credentials Also Be Accountable?

Posted on by Alyssa Brown

Workforce Pell isn’t just a multiyear, bipartisan effort that’s now a policy footnote in President Trump’s sprawling domestic policy bill. It’s a national stress test. And at bottom, it’s a debate about two scarce commodities in federal policy: time and trust.

For decades, federal student aid has been organized around the rhythms of higher education: 15-week semesters, credit hours, and degree pathways that move at an academic pace even when the labor market demands speed.

Workforce Pell brings Pell Grants into a different world, one of short, job-focused programs designed to turn training into wages quickly, often for adults who can’t afford to wait.

But speed is the easy part. The hard part is building credibility by protecting students and taxpayers without smothering the innovation Workforce Pell should unlock. If the new Pell option is too loose, it risks financing low-value programs, replaying the worst chapters of short-term training. If it’s too rigid, it buries legitimate pathways under paperwork and delay.

Continue reading in Work Shift. 

New PPI Analysis Examines Strengths and Shortcomings in 2026 Defense Authorization Bill

Posted on by Alex Terr

A new analysis from the Progressive Policy Institute (PPI) finds that the 2026 National Defense Authorization Act (NDAA) reflects growing bipartisan concern in Congress about the Trump administration’s defense posture. The legislation includes meaningful provisions to uphold U.S. commitments to allies, safeguard key weapons programs, and reinforce industrial capacity. Yet despite these efforts, the NDAA ultimately exposes the limits of congressional resistance to strategic retrenchment, with several guardrails weakened by loopholes and critical omissions that undermine America’s ability to meet current and future security challenges.

The analysis, “Inching in the Right Direction: The Good, the Bad, and the Ugly in the NDAA,” authored by Mary Guenther, Head of Space Policy; Tamar Jacoby, Director of the New Ukraine Project; Peter Juul, Director of National Security Policy, and Justin Littleford, Deputy Political Director, reflects that while the NDAA implements many provisions that protect America’s interests across the globe and in space, the recently passed legislation contains many policies that hinder U.S. strategic influence abroad.

“The NDAA is a small step in the right direction to buck the Trump Administration’s reckless, un-American national security policy,” said Juul. “But in too many places, Congress relies on paperwork and weak oversight instead of making the strong policy and funding decisions needed to rebuke Trump and keep America secure.”

Key findings from the analysis include:

  • A Mixed Record on Weapons Programs Funding: The legislation protects the E-7 Wedgetail program, increases funding for submarine construction, and expands multiyear munitions contracts. However, it cancels the Navy’s Constellation-class frigate, underfunds the F/A-XX fighter, and revives an unnecessary nuclear cruise missile program.
  • A Continued Agreement to Protect American Allies: The NDAA blocks troop withdrawals from Europe and South Korea, reinforces NATO commitments, restores funding for the Baltic Security Initiative and expands Indo-Pacific defense cooperation.
  • Ukraine Support Reduced to Symbolism: Despite strong language prohibiting U.S. recognition of Russian sovereignty over occupied Ukrainian territory and new safeguards to prevent the diversion of weapons meant for Kyiv, the NDAA sharply reduces military aid to Ukraine, so much so that it may allow Putin to win the conflict handily.
  • More Progress for Space Innovation, with Much More to Be Done: The legislation proposes restoring funding for commercial remote sensing and creates an acquisition career path within the Space Force. But it fails to reauthorize the Small Business Innovation Research (SBIR/STTR) program, a critical omission that threatens early-stage defense and space innovation.
  • A Revamped But Faulty Pentagon: While the NDAA limits meddling with the military’s combatant command structure, creates a new position for international defense cooperation, and cuts unnecessary or burdensome regulations, it also allows for military equipment to be used in American deportation missions, an increased reliance on artificial intelligence,, and excludes our European allies from defense cooperation.

“The hulking legislation shows that Congress can use some of its powers to create a structured national security strategy for next year,” said Jacoby. “But it also highlights a troubling gap between intent and real-world outcomes, especially for Ukraine, where underfunding and half-measures fall far short of what the moment demands.”

Read and download the analysis here.

Founded in 1989, PPI is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Find an expert and learn more about PPI by visiting progressivepolicy.org. Follow us @ppi.

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Media Contact: Ian O’Keefe – iokeefe@ppionline.org

Inching in the Right Direction: The Good, the Bad, and the Ugly in the NDAA

Posted on by Alyssa Brown

Earlier this week, Congress passed the annual National Defense Authorization Act (NDAA) — one of the few pieces of regular legislation Congress manages to advance these days. Weighing in at 3,086 pages, this hulking legislation covers everything from the personnel strength of each of the armed services to the safety and security of America’s nuclear arsenal to environmental regulations at military bases and much else besides. 

It’s important to note that while this bill authorizes funding for the military — salaries for service members, money for weapons programs, and the like — it does not actually appropriate it. Instead, the NDAA sets defense policy priorities and parameters, as well as providing a sense of where Congress stands on important national security questions. And as one of the few regular legislative vehicles able to get through Congress these days, the NDAA also tends to accumulate amendments unrelated to defense or national security policy. 

As with any significantly detailed and dense piece of legislation, the NDAA contains its fair share of good, bad, and just plain ugly provisions and proposals — and the 2026 edition is no different. Whatever its weaknesses, however, this NDAA makes plain that Congress sees the world very differently than the Trump White House. 

Where the Trump administration’s recent National Security Strategy called for an effective withdrawal from Europe and the Pacific, abandoning American allies to the designs of Russia and China, the NDAA remains steadfast in America’s commitment to our allies in these parts of the world. It repeatedly calls out Russian aggression and argues for strengthening the NATO alliance as well as America’s alliances with Japan, South Korea, and other nations in the Pacific. It’s clear, moreover, that many members of Congress of both parties remain sympathetic to Ukraine and seek to draw redlines to prevent the Trump administration from imposing a false peace deal on Kyiv. 

At the same time, however, divisions in Congress remain sharp and limit its ability to make good on its intentions. Prohibitions against withdrawals from alliances come with mere reporting and certification requirements susceptible to abuse by bad-faith actors in the Trump administration, who could easily abuse them, while aid to Ukraine has become more symbolic than substantive and meaningful for a nation at war. Though less robust than it might be on these critical issues, the NDAA does nonetheless show a Congress at odds with the Trump administration on questions of foreign policy, defense, and national security.

It’s worth taking a closer look at what the NDAA says about America’s overall defense policy as well, from key weapons programs to space policy to efforts to rebuild the nation’s defense industry.

This policy memo covers the following areas of the NDAA:

  • Weapons programs
  • Allies and partners
  • Ukraine and Russia
  • Space
  • Defense industrial base
  • Policy odds and ends

Read full policy memo.

Lewis and Goldberg for The Hill: We All Should Care Who Funds The Fight for Justice

Posted on by Alex Terr

America’s civil justice system has long been the envy of the world. For 250 years, it has been the keystone of our economic and political liberties, providing a forum for individuals and businesses to redress wrongs and resolve disputes.

Today, this public good is at risk. Hedge funds, foreign wealth funds and other investors are transforming American courtrooms into a new capital market.

Rather than stocks or bonds, they are investing billions of dollars in litigation — creating, buying and controlling high-dollar lawsuits for profit, often hidden from judges, litigants and the public. The scale of these investments — called third-party litigation financing — is staggering and growing fast.

According to the U.S. Government Accountability Office, third-party litigation financing assets doubled from 2017 to 2021. Funders now manage more than $16 billion in litigation investments in the United States and are projected to exceed $30 billion by 2028. Those numbers reflect only self-reported data from major players, so the true figure is undoubtedly much higher.

All of this is relatively new. For centuries, legal doctrines barred outsiders from financing lawsuits because it was understood that outside money could corrupt the justice system. Today, however, courts are either unaware of the funding or ignore these principles.

Read more in The Hill. 

Canter for Washington Monthly: Trump’s Education Tax Credit Gambit

Posted on by Alex Terr

There’s nothing education wonks love more than slapping the word “innovation” onto an idea. The innovation du jour is Donald Trump’s school-choice tax credit, formally known as the “Educational Choice for Children Act,” which the president signed in July. If you read that title and suspect this is a tax diversion to support families who pay, or want to pay, for private or religious school tuition, you’ve got the idea.

This federal tax credit benefits donors who give to a 501(c)(3) nonprofit “scholarship granting organization” (SGO). These SGOs must award at least 90 percent of donations in scholarships for “qualified” educational expenses, including tuition, fees, academic tutoring, and special needs services, among other items, at public, private, and religious schools. Governors (or other state-designated authorities) must opt into the program annually as well as approve their state’s SGOs. Children in elementary and secondary grades with family incomes of up to 300 percent of their area’s median household income are eligible recipients. This means that wealthier families living in affluent areas will still benefit. By some estimates, nearly 90 percent of the population will qualify.

“Red” state governors, especially in states that already have private school choice programs, are likely to opt in. Maybe that’s why all the political chatter has been about whether “blue” state governors should opt in as well. And, boy, has there been chatter.

Read more in Washington Monthly.  

Kahlenberg in Inside Higher Ed: “Merit” Was the Word of the Year in Admissions. But What Does It Mean?

Posted on by Alex Terr

“Advocating for merit is a political winner,” said Richard D. Kahlenberg, the director of the Progressive Policy Institute’s American Identity Project and an advocate of class-based affirmative action. Trump’s speech to Congress celebrating what he characterized as a return to merit was a “good moment, politically, for Republicans, because most Americans believe in merit.” […]

Kahlenberg, too, opposes race-based affirmative action; he testified for the plaintiffs in Students for Fair Admissions v. Harvard and UNC, the case that resulted in the Supreme Court’s ban. But he supports “economic” affirmative action that gives preference to low-income or first-generation students.

“If a student has a certain SAT score or set of grades and they came from a low-income family where the parents weren’t college-educated, where the neighborhood schools were pretty lousy, and they managed to do pretty well despite that—that’s something that most Americans favor,” he said. “They don’t see that as a deviation from merit; they see that as a measure of true merit.” […]

Despite the Trump administration’s focus on merit, though, they aren’t pushing to end legacy admissions.

“If you were truly committed to merit, one of the first things you would do would be to put pressure on universities to eliminate legacy preferences, which are essentially affirmative action for the rich … so one has to question the follow-through on that commitment,” said Kahlenberg.

Read more in Inside Higher Ed.

The Demise of iRobot: How Antitrust Enforcers Missed the Elephant in the Room

Posted on by Alyssa Brown

Antitrust enforcement can be a tough business. Enforcers, and ultimately the courts, referee the markets, calling balls and strikes on consolidation and business conduct that is benign or even pro-competitive, versus anti-competitive and harmful to consumers. For the most part, U.S. antitrust enforcement has gotten it “right.” This is remarkable, given that enforcers don’t have a crystal ball to predict market outcomes. But it also means that unpacking lessons learned from both successes and failures is essential for improving antitrust enforcement moving forward.

Case in point. Take iRobot, the original maker of the Roomba robotic vacuum cleaner (RVC) that filed for Chapter 11 protection in U.S. bankruptcy court this week. This is the iRobot that Amazon proposed to acquire and integrate into its e-commerce marketplace in mid-2022, but was, instead, forced to abandon in early 2024. iRobot was acquired in a private transaction by the Chinese company, Picea Robotics, which owns a competing brand. With the sale to Picea, iRobot will no longer be a standalone competitor, and Picea will grow larger. Together with newer and more innovative RVC rivals, these developments have restructured the RVC market. 

All of this comes two years after the European Commission (EC) and U.S. Federal Trade Commission (FTC) signaled they would move to block Amazon’s $1.65 billion acquisition of iRobot, effectively forcing Amazon and iRobot to abandon the deal. The EC’s statement of objections in late 2023 flagged the concern that Amazon could restrict competition in the market for robotic vacuum cleaners (RVCs), hampering rival RVC suppliers from competing effectively. After an extended merger review that increased the financial burden on iRobot, the Biden FTC under Chair Lina Khan followed the EC’s lead. FTC staff issued an unusual statement in early 2024, noting the agency’s pleasure that Amazon and iRobot had abandoned the deal.

To understand the implications of this enforcement outcome, let’s gather some relevant history. In early 2021, iRobot’s stock price was at an all-time high of about $133 per share. At the time the acquisition was announced in mid-2022, it was at about $60 per share. At the end of 2023, the stock price was at about $38 per share, and this week it fell to under $1 per share. This precipitous devaluation was accompanied by a decline in iRobot’s capitalization. 

iRobot also reduced its workforce by close to 50% since 2024, laying off hundreds of workers located at the company’s headquarters in Massachusetts. Massachusetts is home base for Senator Elizabeth Warren, who issued a strong letter urging the FTC to block the deal. The letter’s conclusion that Amazon’s “anticompetitive policies [that] put consumers and their privacy at risk,” however, seems knee-jerk — devoid of any understanding of the competitive dynamics of age-old retailing methods where companies maintain robust competition between their private labels and competing brands.

To be sure, the Trump Administration’s crushing import tariffs have not made it easier for iRobot to survive. But iRobot’s downward spiral — which entirely predated the impact of tariffs — openly signaled a company in distress, even as antitrust enforcers moved to block its sale to Amazon. That in itself was not enough evidence to support calling the antitrust referees off the field at the time Amazon made its bid for iRobot. For example, the “failing firm” defense may apply when the assets to be acquired “would imminently cease playing a competitive role in the market even absent the merger.” But the courts hold parties to a merger to a very high standard in invoking the failing firm defense. 

Given this, the EC’s and FTC’s rejection of any failing firm defense is not unusual. What is unusual is that the EC and FTC needed to, but did not consider, more evidence when deciding to move to block Amazon’s purchase of iRobot. Take the JetBlue-Spirit merger, which the DOJ successfully blocked in 2024. Spirit was also in visible distress and subsequently entered into Chapter 11, but the company continues to operate as a viable entity. The DOJ noted, in particular, that the markets for air passenger service feature high entry barriers that limit the role of potential entrants in deconcentrating the market. 

How about white goods manufacturer Whirlpool’s acquisition of rival Maytag in 2006? At the time, Maytag was also in financial distress, but the DOJ decided not to block the deal. The merger would have significantly increased concentration, but the imminent entry of Asian white goods manufacturers such as LG, Samsung, and Haier was expected to deconcentrate the market. 

Unlike in Spirit-JetBlue and Whirlpool-Maytag, antitrust enforcers missed the elephant in the room in Amazon-iRobot. That is, namely, the role of newer and more innovative players in deconcentrating a market by turning up the competitive pressure on incumbents with better technologies and business models that lower cost and improve quality. Whether this reflects incomplete analysis or the politics of the Biden FTC’s hunt for antitrust violations involving e-commerce markets doesn’t really matter. Every merger investigation should cover all the bases, like a good referee.

PPI’s 2025 Year in Review

Posted on by Max Sherrill

Dear friends, 

2025 began on an anxious note, as America’s most polarizing president ever returned to the White House vowing to wreak vengeance on his political opponents. As the year ends, however, our democracy is displaying its recuperative powers. There’s been a public backlash against this president’s retrograde economic policies and aberrant personal behavior. And the sweeping gubernatorial victories of Abigail Spanberger in Virginia and Mikie Sherrill in New Jersey last month suggest a growing public appetite for a pragmatic center-left alternative.

With your help, PPI has spent the last year laying the political and intellectual groundwork for a center-left revival. We’ve commissioned intensive opinion research to better understand the motivations of non-college voters. We’ve convened strategic “New Directions” dialogues across the country showcasing a rising generation of political leaders. And in keeping with our core mission, we’ve developed innovative ideas to help those leaders win and govern effectively.

For example, we launched an American Identity Project to focus Americans on the shared beliefs that unite us rather than tribal identities as our country prepares to celebrate 250 years of independence next year. We’ve also launched an exciting new project on space policy, which has important commercial and national security dimensions. PPI also joined forces with the Tony Blair Institute to create a new international dialogue called “Reinvigorating the Center-Left.” Our Reinventing America’s Schools project published a “New Compact for Educational Excellence” to reverse the slide in student achievement in our public schools.

In addition, we continued to develop a new economic offer for working Americans focused on raising skills and lowering living costs; highlighted the impact of growing economic concentration in the delivery of health care; documented the damage tariffs have done to the nation’s economy; developed a framework for energy and climate policy based on energy abundance and innovation; and offered radically pragmatic proposals for restoring fiscal discipline in Washington.

Our plans for 2026 include a strong focus on making government work better, and honing a new PPI blueprint for defending America and repairing relations with our key friends and democratic allies around the world.

Read PPI’s full 2024 year in review.

Tariff bill on toys and Christmas ornaments up 300-fold this year

Posted on by Alex Terr

FACT: Tariff bill on toys and Christmas ornaments are up 300-fold this year, from $7 million to $2 billion.

THE NUMBERS: U.S. tariff collection, January-September* –

Product        2024               2025
Toys and dolls     $0 million $1,509 million
Video game consoles     $0 million    $448 million
Christmas ornaments     $7 million    $446 million
Other Christmas decorations     $0 million      $66 million
Nativity scenes     $0 million        $8 million
Sports equipment $309 million    $993 million
Musical instruments   $62 million    $144 million
Cards and magic tricks     $0 million      $38 million

* Most recent data available. About a third of toy imports arrive in October, November, and December, so the final 2025 totals will likely approach $2 billion for toys, $0.7 billion for ornaments, Nativity scenes, and other decorations, and $0.7 billion for video game consoles and accessories.

WHAT THEY MEAN: 

Having squeezed down the chimney, the Grinch pokes his head out of the fireplace and looks around:

“‘These stockings,’ he grinned, ‘are the first things to go!’
Then he slithered and slunk, with a smile most unpleasant,
Around the whole room, and he took every present!
Pop guns! And bicycles! Roller skates! Drums!
Checkerboards! Tricycles! Popcorn! And plums!
And he stuffed them in bags. Then the Grinch, very nimbly,
Stuffed all the bags, one by one, up the chimney!”

Then he takes all the food in the house and steals Cindy Lou’s tree.

The Trump administration’s comparably weird idea for a de facto two-doll-per-girl rationing system hasn’t entirely panned out. It hasn’t wholly failed, though. With tariffs higher and prices rising, Americans are spending less on Christmas gifts this year than last, and getting less for the money they do spend.

The National Retail Federation’s mid-October estimate notes that “tariffs remain on top of mind for most holiday shoppers, with 85% anticipating higher prices because of tariffs”. They predicted that the average American household would spend $890 on holiday gifts this winter, which would be a $12 drop from 2024’s $902, and adjusting for this year’s higher prices, a real-dollar drop of about 3%, to $863. Coincidentally or not, as PPI’s Fiscal Policy Analyst Alex Kilander points out this week, the 3% real-spending drop almost perfectly matches the BLS’s Consumer Price Index estimate of a 3% rise in toy prices this year.

NRF’s 85% aren’t wrong to worry. Census figures on tariffs are complete only through September, so they haven’t yet tallied the bill for holiday-season shipments in October and November. But even the January-to-September figures already show a hike in the toy-tariff bill from nothing in 2024 to $1.5 billion this year. Video-game consoles got a similar $0 to $448 million hike. Tariff collection jumped 80-fold on Christmas tree ornaments and other decorations — $7 million last year, more than half a billion dollars this year — and rose by $8 million even on creches and Nativity scenes.

In effect, rather than swiping the presents and throwing them off a mountain, the Trump team is heavily taxing them. (U.S. Supreme Court, 1819: “The power to tax involves the power to destroy”.) We can’t precisely line up the administration’s tariff bill with the Grinch’s raid on Whoville, because the Harmonized Tariff Schedule metaphorically stuffs all toys, dolls, tricycles, balloons, and so forth into a single bag (HTS line 95030000). But we can do a pretty close match, starting in the same way with the stockings:

PRODUCT 2024 TARIFFS 2025 TARIFFS
Socks & other hosiery      $225 million      $441 million
Toys, dolls, etc         $0 million   $1,509 million
Bicycles      $109 million      $159 million
Roller skates          $0 million          $5 million
Drums          $4 million          $7 million
Board games          $0 million        $59 million
Popcorn          $0.01 million           $0.2 million
Plums (fresh)          $0 million           $0.5 million
Plums (preserved/sugared)          $0.4 million           $0.6 million

 

So buyers of children’s gifts like tricycles and popguns (both in the toy group, along with the dolls) have taken a big financial hit. Bicyclists and gamers — traditionalist board aficionados and video and digital enthusiasts alike — only slightly less. The tariff impact on drums and roller skates is a bit less dramatic, in the seven-digit “millions” of dollars rather than the nine-digit “hundreds of millions.” Popcorn mostly comes from U.S.-grown corn and doesn’t attract many tariffs. Imported plums (mainly from South America) usually arrive between January and April, so most of the 2025 shipments got through Customs before the tariff decrees hit. As to your tree, no data yet. The administration’s lumber-tariff decree only went live at the end of September, so we don’t yet know how big the extra bill will be.

The Whos, of course, make the best of an unfortunate situation and go out for their sunrise caroling anyway. American parents, couples, and friends next week will probably do likewise.  But it shouldn’t have to be this way. Congress has all the power it needs to put a stop to this sort of thing, if it wants to, before the 2026 holidays.

Special note: PPI trade staff will be on holiday through the New Year. Our Trade Fact service will accordingly take a two-week break and resume on January 7. We wish PPI’s friends and readers, at home and abroad, a peaceful and happy holiday season

FURTHER READING

Dr. Seuss’s The Grinch Who Stole Christmas.

The White House press office elaborates on Mr. Trump’s doll-rationing idea. So far, they haven’t hinted at things boys should give up, but there’s still a week left.

And PPI’s Alex Kilander and Nate Morris on Trump administration economic policy, tariffs, and their impact on Christmas.

Outlook and prices:

The National Retail Federation’s 2025 holiday survey (out October 16th).

Data:

The New York-based Toy Association reports that Americans spend about $28 billion a year on toys, exactly a quarter of the $112 billion world market. This figure appears to combine some of the relevant tariff codes (toys as such get one 4-digit line, electronics another, sports equipment a third), so the tariff-to-product match is a little awkward.

The Bureau of Labor Statistics’ CPI inflation calculator.

… and the Federal Reserve’s “FRED” service has 40 years of Consumer Price Index toy data.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007). He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

Read the full email and sign up for the Trade Fact of the Week.

 

Guenther for Space News: Trump’s National Security Strategy Ignores Space

Posted on by Alex Terr

The Trump administration’s new national security strategy has rightly drawn criticism for presuming to tell our European allies how to arrange their domestic affairs. Equally as baffling is its near silence on a genuine United States national security concern — bolstering our offensive and defensive capabilities in space.

Amid much MAGA trollery that blames Europe rather than Russia for the continuing war in Ukraine, the new national security strategy makes only one reference to space in the 29 page document. That reference is in passing, mentioning space amongst a list of technology domains that deserve research investment to retain the nation’s technological edge. Whether we like it or not, space has increasingly become a warfighting domain. President Biden mentioned space 15 times in his last national security strategy. Trump treats it as an afterthought.

Top military brass from the head of U.S. Space Command to the principal space advisor at the Department of the Army has been calling for the development of offensive space capabilities.

Other nations, especially China, have been deploying space weapons and, while everyone would prefer that space remain a peaceful domain, the U.S. must ensure it is prepared to meet national security threats in whichever theater they arise in.

This is not a solely American perspective. NATO recognized space as an operational national security domain in 2019 and has been working to beef up its space capabilities.

Read more in Space News.