The Washington Post reports that Ron Paul “is enjoying a surge in support and the most high-profile campaign of his life. ”

Paul’s unwavering ideals of small government and free markets, which rendered him a quirky sideshow for decades, have gained traction amid concerns about rising government debt. His longtime opposition to the existence of the Federal Reserve, income tax and foreign aid is now shared by many in his party.…

[Ron] Christie noted that Perry and former House speaker Newt Gingrich have been pushing anti-Federal Reserve stances in recent television debates. Other strategists observe that all the candidates have started peppering their speeches with references to the Constitution. Paul’s years of insistence on small government are widely considered to have paved the way for the emergence of the tea party movement.

Over the past few months various reporters have asked me about Ron Paul’s greater prominence this year as compared to 2007, and I’ve generally told them something like this:

In 2007 (which is when he got the most attention in the last cycle) Ron Paul warned that an economy based on debt and cheap money from the Federal Reserve was not sustainable, but the economy was booming and nobody wanted to listen. After the crash, they started listening. In 2007 he said we should replace the Federal Reserve and fiat money with the gold standard, and even some libertarians said things like, “What’s the beef with the Fed? They’ve dramatically reduced the volatility of the business cycle while achieving low, reasonably constant inflation.” Nobody’s scoffing at criticism of the Fed now. In 2007 Ron Paul criticized excessive federal spending, but with a Republican in the White House Republicans weren’t so interested. With even more excessive spending by a Democratic president, that’s become a central issue of the era. In 2007 Ron Paul criticized endless military intervention, but most Republicans were content to repeat, “The surge is working.” Now even Republicans are getting weary of war. In 2007 Ron Paul said that Congress and the president should not act outside their powers under the Constitution, but Republicans didn’t want to hear about unconstitutional acts by a Republican president. Now, after the bailouts and the health care takeover and the unauthorized war in Libya, all the Republican candidates are talking about restoring the Constitution.

It’s not that Ron Paul has moved closer to the center but rather that the center of American political discussion has moved closer to him.

Like many libertarians, I’ve had my differences with Ron Paul on trade policy, immigration, gay rights and federalism, and the unsavory company he keeps. But as long as he keeps recruiting people, especially young people, to the cause of limited constitutional government, sound money, and non-intervention, I’m glad to see him making an impact.

Back in March of this year, with a May deadline for REAL ID compliance looming, the U.S. Department of Homeland Security quietly kicked the can down the road. It once again changed the date on which states would have to implement federal standards for their drivers’ licenses and IDs.

The original deadline was three years after the law’s May 2005 passage. It has now been more than five years and there’s no REAL ID thanks to resistance from states around the country. Congress has not moved to repeal this failed law. In fact, it still appropriates money to REAL ID in the Homeland Security appropriations bill.

The DHS has now set a new compliance deadline at January 15, 2013. That’s five days before the next presidential term begins on January 20, 2013. Indeed, the period between the election and the inauguration is when the question of whether to enforce REAL ID against the states will be decided.

Which puts a question before the Republican candidates vying for the highest political office. Where do you stand on the national ID issue? If your Transportation Security Administration is turning fliers away from airports because their states aren’t going along with this federal surveillance mandate, are you going to stand by the feds or stand by the states and people who say no to having a national ID?

The question is a nice bellwether for Republicans on both federalism and essential American liberty.

Do you need further proof that the war on drug is a failure? Then just read the 2011 National Drug Threat Assessment report recently published by the Justice Department. Here are some interesting quotes:

• The abuse of several major illicit drugs, including heroin, marijuana, and methamphetamine, appears to be increasing, especially among the young. [pag. 1]
• The overall availability of illicit drugs in the United States is increasing. Heroin, marijuana, MDMA [ecstasy], and methamphetamine are readily available, and their availability appears to be increasing in some markets. [pag. 24]
• An estimated 8.7 percent of Americans aged 12 or older—or 21.8 million individuals—were current illicit drug users in 2009, a statistically significant increase from 8.0 percent in 2008. [pag. 1]
• Major Mexican-based TCOs [trasnational criminal organizations] and their associates are solidifying their dominance of the U.S. wholesale drug trade and will maintain their reign for the foreseeable future. [pag. 7]
• Mexican-based TCOs were operating in more than a thousand U.S. cities during 2009 and 2010 [last year’s report put the figure at 270 cities]. [pag. 8]

You can read the full report here.

Today, The Royal Swedish Academy of Sciences announced that it had awarded this year’s Nobel Prize in Economic Sciences to Prof. Tom Sargent (along with Prof. Chris Sims). Prof. Sargent is not only a high priest of economic theory — the rational expectations variety — but also one of the last in a dying breed of economists who can read a balance sheet and wield a sharp pencil.

For students of hyperinflation, there is no better place to start than Prof. Sargent’s classic: Rational Expectations and Inflation (Second Edition, 1993). That’s where I began when I started to grapple with the problem of estimating Zimbabwe’s hyperinflation.

In my study of Zimbabwe’s inflation, Prof. Sargent’s work proved to be invaluable. Prof. Sargent’s theoretical rigor and ability to do sharp pencil work on central bank balance sheets, fiscal accounts and many other relevant data, allowed me to clear away a great deal of Zimbabwean underbrush.

Prof. Sargent’s Rational Expectations and Inflation remains one of the best examples of economic sharp pencil work. The details of just how Germany ended its infamous hyperinflation are all there. For example, to put its fiscal house in order and stop its hyperinflation, Germany, among other things, slashed the number of government employees by 25 percent with a decree of 27 October 1923. Where there is a will, there is a way.

In Washington, one is expected to be grateful for even small breakouts of relative sanity. Consider, for example, the Department of Transportation’s decision to scale back its widely blasted regulations meant to force local and state governments around the country to replace perfectly good street and road signs with new signage of prescribed lettering, size and “retroreflectivity.” (If you missed the announcement — it was dropped into the news just before Labor Day — here are the Detroit News and New York Times accounts.) Instead of requiring local authorities to replace all old signs by 2018, DoT will now (with some exceptions) let them wait until signs wear out before having to follow the new design standards. That means New York City won’t be obliged to drop many other projects in favor of a crash program to replace its more than 300,000 signs, Delaware can spread the $60 million plus it expects to spend over a longer period, and so forth for thousands of other towns, counties and states that had flinched at billions in new mandated spending.

The delay in implementation is welcome, but what’s still absurd is the idea of there being any mandate at all. The Framers prescribed a federal government of limited powers, which did not include the power to prescribe the retroreflectivity, size or lettering of everyone’s local street signs. Supposedly, older drivers will find the new big-and-reflective signage a boon, though I suspect no one has actually asked them whether they expect their navigation to improve once the town has ripped out all their familiar signs. And while safety may be advanced by standardized designs for, say, stop signs and one-way arrows, the great bulk of signage, on street names in particular, will work fine without national standardization, which indeed may choke off fruitful experimentation adapted to local conditions.

One group quoted as supportive of the full mandate is the American Road and Transportation Builders Association. According to the group’s website: “On behalf of its more than 5,000 public and private sector members, ARTBA’s primary goal is to aggressively grow and protect transportation infrastructure investment” — that is, to keep more and more money flowing for roads and their improvers.

Chris Edwards and I have repeatedly called for policymakers to get specific when it comes to spending cuts. Policymakers who want to cut spending should at least pick an agency or program and work to have it eliminated. Rep. Mike Pompeo (R‑KS) has done this by introducing legislation to terminate the Department of Commerce’s Economic Development Administration.

What I really like about Pompeo’s justification for eliminating the EDA is his recognition that the federal government should not be subsidizing local affairs:

I believe investing should be done by private citizens with their own money, not by federal agencies. I have spent my time in Congress working to create an environment that encourages such investment and risk-taking behavior. The Economic Development Administration is a White House earmark machine and, for the past 45 years, has redistributed wealth for purely local projects. In light of the nation’s $14.8 trillion debt, the federal government simply must focus on its core constitutional responsibilities.

No area of the country has been left out. In fact, there have been a number of projects in the Fourth Congressional District of Kansas that have received EDA grants. I do not fault the grant recipients—the money was available, the grant requirements were met and these applicants were simply responding to a federally created incentive system. The problem is that nearly all of these projects would have gone forward without EDA funds as the source for a tiny fraction of total project funding. With state, local and, most importantly, private sector sources of funding, economic development projects can—and should—move forward without utilizing the EDA as a crutch.

Kansas taxpayers should not be funding local projects all across the country, just as citizens in the other 49 states need not be funding our local projects. Imagine the Kansas projects that would have created jobs in our state had the EDA not drained billions of dollars from taxpayer pockets over the decades of EDA’s existence. That is the real job-destroying legacy of EDA.

See this Cato essay for more on why the Economic Development Administration should be terminated.

The number of Cubans intercepted at sea trying to reach the coast of Florida more than doubled in the last fiscal year according to figures released by the Department of Homeland Security. In the previous fiscal year, 422 Cubans were intercepted at sea by the Coast Guard, while in the fiscal year 2011 (which just ended on September 30th), 1,000 Cubans were caught. Moreover, the number of Cubans who actually reached the U.S. shore increased by 70%, from 409 in fiscal year 2010 to 696 in fiscal year 2011. This is the first rise in illegal Cuban immigration by sea in 3 years according to authorities.

This is yet another sign that the much heralded economic “reforms” announced by Havana aren’t working. The massive layoffs of hundreds of thousands of public employees undertaken by the government of Raúl Castro were meant to be absorbed by Cuba’s almost non-existent private sector. The Communist regime tried to ease the pressure by allowing private employment in 178 economic activities, such as masseurs, clowns, shoemakers, locksmiths, and gardeners. However, as I warned over a year ago, it capped the number of permits for these private activities at 250,000 while also penalizing the new entrepreneurs with stiff tax rates. It doesn’t take a Nobel Prize winner in economics to realize that Cuba’s nascent private sector wouldn’t be able to make room for all of the newly unemployed. What then for these people?

Earlier this year I talked to an official from the U.S. Interest Section in Havana who told me that we shouldn’t be surprised if we see a steady increase of Cubans trying to escape the island towards the United States. Faced with a dilapidated economy, hundreds of thousands of unemployed, and growing social unrest, the Castro regime wouldn’t hesitate in letting more Cubans use the “escape valve” of emigration. We might be seeing the first signs of this.