In an encouraging step for New Jersey children, the state’s Senate Economic Growth Committee has approved a K-12 scholarship donation tax credit bill like the ones already operating in Florida, Pennsylvania, Arizona, Iowa, and Rhode Island. It would allow businesses to make donations to nonprofit scholarship funds that would in turn bring the option of private schooling within reach of low-income families.

Needless to say, the bill has earned the “intense opposition” of New Jersey’s large and powerful public school employees union. The last time somebody offered Jersey’s poor kids an escape from the union-dominated public schools, the union made that somebody an offer that was difficult to refuse.

The “somebody” in question was PepsiCo. As I wrote in Market Education:

In late October of 1995, officials of the Pepsi company announced at Jersey City Hall that their corporation would donate thousands of dollars in scholarships to help low-income children attend the private school of their choice. The immediate response of the local public school teachers’ union was to threaten that a statewide boycott of all Pepsi products could not be ruled out. Pepsi vending machines around the city were vandalized and jammed. Three weeks later, company officials regretfully withdrew their offer.

And you thought the Sopranos were nice.

In his excellent blog, Roger Pielke, Jr., notes that “On NPR’s Fresh Air earlier this week, Al Gore suggests that Typhoon Nargis, which may have killed 100,000 people in Myanmar, is linked to greenhouse gas emissions, or does he? He said ‘we’re seeing consequences that scientists have long predicted might be associated with continued global warming.’”

So I checked the sea surface temperature (SST) “anomalies” (that is, differences in temperature from the long-term average) along the track of Cyclone Nargis to see if SST might have been unusually warm from April 28^th to May 3^rd (when it hit Burma) of this year compared to last year. Comparing the SST anomalies from NOAA for April 28, May 1, and May 5 of 2008 against April 28, May 1, May 3, and May 7 of 2007, SSTs along the track of Cyclone Nargis don’t look that much different from last year. And for April 30, May 3, and May 7 of 2005, the Bay of Bengal seems to have been noticeably warmer.

Granted, this is based on a cursory eye-ball view of the maps using a non-continuous data set. I await more detailed analysis with bated breath.

Excellent.

It’s an all-too-common tactic employed by opponents of educational freedom to demonize school-choice advocates as hell-bent ideologues rather than actually tackling their arguments and evidence. One suspects that this occurs for two primary reasons: (1) smearing is easier than debating, and (2) too many choice opponents don’t have the evidentiary ammunition they need to defend their arguments.

Well, on Jay Greene’s blog today, at least one ardent supporter of school choice — the Friedman Foundation’s Greg Forster — fires a huge shot across the bow of choice detractors especially on the right, letting them know that he’s had it with their ignoring empirical evidence and resorting to playground name-calling. (In fairness to the Manhattan Institute’s Sol Stern, Forster’s primary target, he did come to Cato to debate his recent critique of choice — more than others on his side seem willing to do — though that doesn’t mean he isn’t still dodging inconvenient evidence).

With a little luck, Forster’s essay will help ignite a rational debate on market education reform that’s long overdue, and this time conservative choice detractors won’t just hide behind “ideological” smoke.

President Bush addressed the Council of the Americas yesterday, a business organization whose stated goal is to promote democracy and free markets in the Americas.  Among the different subjects he touched in his speech, Bush highlighted the work of the Millennium Challenge Account (MCA) in Latin America.

The MCA’s goal is to provide bilateral aid to countries whose policies promote good governance and economic freedom. In Latin America, some of the standard bearers of good governance and economic freedom according to the MCA are Honduras, Nicaragua and Paraguay.

Bush proudly said in his speech that “In Paraguay, we’re working… with local leaders to reduce the cost of starting new businesses.” It sounds quite good, but when you look at the MCA’s Threshold Quarterly Report for Paraguay, you find among the accomplishments of the program this:

The Finance Ministry conducted simulated purchases to detect firms not following local tax regulations, resulting in the suspensions of more than 70 businesses. The business suspensions received significant positive media coverage and have generated greater tax compliance overall.

It sounds like U.S. aid money is being spent to shut down businesses in Paraguay. That hardly fits my idea of encouraging economic freedom in Latin America.  

Here’s Michael Goldfarb:

As to whether Bush is a recruiting tool for terrorists–who cares? Al Qaeda was recruiting before Bush was in office and they will continue to do so after he’s gone. The important thing is that we keep killing those recruits. Eventually, one side will give up.

Do they edit this stuff before putting it up? By this logic, why don’t we airdrop a bunch of copies of Penthouse Letters into the Kabaa? After all, al Qaeda will continue recruiting whether we do it or not. Or maybe we could declare war on all of Islam. After all, al Qaeda was recruiting before we declared it. Or maybe we could send Senator McCain’s “moral compass and spiritual guide” onto al Hurra to tell Muslims that “America was founded, in part, with the intention of seeing this false religion destroyed.” After all, it’s not like al Qaeda’s not recruiting today.

The Style section of today’s Washington Post features a terrific article about the National Security Archive, the nonprofit group dedicated to unearthing goverment secrets. The privately funded group, about 35 strong, uses the Freedom of Information Act to collect about 75,000 documents a year, which staffers analyze and then post on the website. The Archive’s greatest hits (see, e.g., here and here) demonstrate that as Patrick Henry put it, one should “never depend on so slender a protection as the possibility of being represented by virtuous men.” Don’t trust: verify.

One of my favorite documents on the site is the Operation Northwoods Memo, prepared by the Pentagon in the wake of the Bay of Pigs disaster:

titled “Justification for U.S. Military Intervention in Cuba” [the memo] was provided by the JCS to Secretary of Defense Robert McNamara on March 13, 1962, as the key component of Northwoods. Written in response to a request from the Chief of the Cuba Project, Col. Edward Lansdale, the Top Secret memorandum describes U.S. plans to covertly engineer various pretexts that would justify a U.S. invasion of Cuba. These proposals - part of a secret anti-Castro program known as Operation Mongoose - included staging the assassinations of Cubans living in the United States, developing a fake “Communist Cuban terror campaign in the Miami area, in other Florida cities and even in Washington,” including “sink[ing] a boatload of Cuban refugees (real or simulated),” faking a Cuban airforce attack on a civilian jetliner, and concocting a “Remember the Maine” incident by blowing up a U.S. ship in Cuban waters and then blaming the incident on Cuban sabotage.

Sounds like tinfoil-hat stuff, I know, but thanks to FOIA and the National Security Archive, you can check for yourself [.pdf]. But if Dick Cheney and Donald Rumsfeld had had their way, you couldn’t. As top aides to Gerald Ford 34 years ago, they urged the president to veto amendments strengthening FOIA (he did, and Congress overrode his veto). The Archive has the documents on that too.

(cross-posted on genehealy.com)

Nearly two years after its release, David Hyman’s satire Medicare Meets Mephistopheles is still generating reviews — and controversy. 

In the April 2008 issue of the Michigan Law Review, Michigan law professor Jill Horwitz raves:

Hyman is extraordinarily knowledgeable about health care regulation and his exposition is succinct. The book is filled with informative and accurate summaries of Medicare’s complicated program design and related laws. The summaries of fraud and abuse law, for example, make my heart sing. I’ve seldom seen such an accessible and accurate primer.

It would be a stretch, however, to claim that Horwitz and Hyman see eye-to-eye.  Horwitz concludes her 19-page review thus:

Medicare Meets Mephistopheles is a terrific overview of a troubled system, but a missed opportunity to help reform Medicare. Providing health care fairly and efficiently is a complicated process that necessarily involves a heavy dose of government. Libertarian railing against big government, regulation, and all lefty foolishness that market proponents despise doesn’t get one very far in determining how to get health care to 300 million people. In the end Hyman doesn’t offer any realistic alternative to this government-regulated muddle because, God knows, his plans are unacceptable anywhere but in hell.

Ay caramba!

The president of West Virginia University, Michael Garrison, is hanging on after the school’s faculty voted 77 to 19 to demand his resignation. Faculty members are outraged that Garrison retroactively awarded an MBA to a friend, who is the daughter of Gov. Joe Manchin III. The Washington Post reports:

Garrison’s critics note that he is a former classmate of Bresch’s. He once worked as a lobbyist for Mylan Inc., where Bresch is an executive and whose chairman is one of WVU’s biggest donors. They also note that Garrison was chief of staff for former West Virginia governor Bob Wise (D).

The Post failed to add the detail that Garrison served on Manchin’s transition team when he succeeded Wise. So yes, when you hire a lobbyist and political operator to run a university, you can expect some favors for politically connected friends.

A TV News helicopter filmed Philadelphia police officers as they repeatedly kick three suspects as they lay on the ground.  Go here to see the video clip.

Police Commissioner Charles Ramsey says 5 officers have been taken off street duty because of their actions.   Why are those 5 not under arrest for battery?

Philadelphia authorities reportedly hope to identify the other police officers involved in the incident.  Hope?!    If the Commissioner can’t or won’t issue an order to come forward or face dismissal by the close of business, there are deeper problems with the police department.

Consider the following:

1. Research suggests the federal Medicare program spends as much as $100 billion per year on medical care that makes seniors neither healthier nor happier.
2. Medicare’s payment system continues to reward low-quality and even harmful medical care.
3. The trustees of the Medicare program have issued yet another annual report containing dire warnings about Medicare’s financial sustainability, including an unfunded liability of $86 trillion.
4. According to economist and former Medicare trustee Tom Saving, Medicare alone will require tax rates to rise by 25 percent within a generation, and to double within 75 years, absent reform.  
5. The picture is far worse than it was when politicians were developing fundamental Medicare reforms 10 years ago.

You would think that Medicare reform would be a high priority for politicians.  You would be wrong. The president has proposed reforms that would barely slow the program’s growing dependence on general revenues — a proposal that Congress has largely ignored. The leading presidential candidates advocate tweaks — such as reducing payments for private plans and prescription drugs, or tying payments to quality measures — rather than fundamental reforms.

To help get the politicians focus on this crucial issue, the Cato Institute will host a policy forum on Thursday, May 15, titled, ”Whatever Happened to Medicare Reform?”  Tom Saving, the Commonwealth Fund’s Stuart Guterman, and I will discuss the current state of the Medicare program, and how the program needs to be reformed.  The forum will run from 12pm to 1:30pm. 

Click here to register.

Market-oriented health-care wonks have proposed various ways of reforming the tax treatment of health insurance that would level the playing field between job-based coverage and coverage that consumers purchase directly (i.e., on the “individual” market).  The key to those proposals is that they would let workers control money their employer now controls, and generally would allow workers to spend those earnings on the mix of medical care and health insurance that meets their needs. 

The political Left typically protests that if workers had the freedom to spend their earnings however they want, the multiplying villainies of the market would swarm upon the sick, leaving them with no insurance coverage.  For example, Elizabeth Edwards and others chide Sen. John McCain because, they claim, people with chronic conditions could not obtain health insurance in an unregulated individual market.  Edwards even wrote: “The insurance company makes money when it doesn’t have to pay for our health care. (I suspect that if they could, they would write obstetrical-only policies for nuns.)”

An economist at the University of Pennsylvania named Mark Pauly spends much of his time collecting evidence — I repeat, evidence — that this view does not reflect the reality of unregulated health insurance markets.  Pauly and his colleagues have found:

[A]ctual premiums paid for individual insurance are much less than proportional to risk, and risk levels have a small effect on obtaining coverage. States limiting risk rating in individual insurance display lower premiums for high risks than other states, but such rate regulation leads to an increase in the total number of uninsured people. The effect on risk pooling is small because of the large amount of risk pooling in unregulated individual insurance.

and

[T]here was substantial cross-subsidization of high-risk by low-risk persons in the individual insurance market in a period in which there was only minimal state regulation. Premiums do rise with risk, but the increase in premiums is only about 15 percent of the increase in risk. Premiums for individual insurance vary widely, but that variation is not very strongly related to the level of risk.

A new Health Affairs Web Exclusive by Pauly and colleague Robert Lieberthal offers further evidence that a freer market would provide high-cost patients more protection than today’s government-created employment-based system.  Pauly and Lieberthal write:

[A] young high-risk male who initially had small-group coverage faces a 44 percent chance of becoming uninsured in the next period—a risk nearly twice as great as it would be if he initially had individual insurance.  Somewhat ironically, the usual blame for such a person’s lacking coverage will be laid at the door of the medically underwriting individual insurer, which quotes a high premium, rather than being referred in part to the group insurance system that plunged this person into such a vulnerable situation in the first place.

Thus, it is not true that more freedom would mean no health insurance for people with costly medical conditions.  Provided consumers insure while they are still healthy, individual-market coverage offers as much or more protection to high-cost patients than they have now.

In the transition to a level playing field between employer-sponsored and individual-market coverage, there may be some people with high-cost conditions who lose their existing coverage, and cannot obtain subsequent coverage.  If that occurs, most Americans will want to offer some form of subsidy to those hard cases — a group that does not include wealthy people like Elizabeth Edwards, John McCain, or Jay Cutler.  

When fashioning those subsidies, policymakers should bear two things in mind.  First, as Pauly’s work suggests, this is likely to be a temporary problem; markets can and will cover tomorrow’s high-cost patients.  Second, policymakers should not try to force insurance markets to provide the desired subsidies; that would undo the substantial good that unregulated insurance markets can achieve.

Over at The American Conservative blog, Jim Antle points out that Rep. Walter Jones, an antiwar Republican incumbent, as well as another antiwar Republican, B.J. Lawson, won big in last night’s North Carolina primary.

Although the Republican establishment in Washington seems to have sacrificed every other governing principle at the altar of reckless militarism, it appears that a contingent of Republican voters haven’t. Maybe Bill Kauffman is onto something…

Suppose you work for a company experiencing phenomenal revenue growth. Most of that growth is attributable to rapidly increasing sales to new customers with potentially limitless demand for your products.

Then the CEO unveils next year’s strategic plan, which includes actions likely to offend and financially injure those new customers, causing them to take their business elsewhere and jeopardizing your company’s future.

If you work in almost any goods-producing industry in Indiana or North Carolina, the above is not hypothetical. It is precisely what you confront if either Senator Clinton or Senator Obama becomes the next president.

You see, both candidates profess deep skepticism about international trade. Both plan to halt new trade agreements and to force our partners to renegotiate existing deals. Both support provocative, unilateral actions that would ultimately hurt American producers, consumers, and investors. And both insinuate that our trade partners are untrustworthy adversaries.

But Indianans and North Carolinians should recognize those trade partners as something different – like their fastest-growing customers.

Indiana’s producers shipped $26 billion worth of goods to foreign customers in 2007, which was 14 percent more than the year before and 80 percent more than in 2001. Since 2001, the state’s exports have grown at a rate one-third faster than U.S. exports overall.

North Carolina’s producers shipped $23 billion worth of goods to foreign customers in 2007, which was 10 percent more than the year before and 59 percent more than five years ago.

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Everyone knows that our public schools are underfunded, right? So why do they keep blowing easy money?

You might recall that last week the Miami-Dade School District turned down a principal’s offer to work for a single dollar on the grounds that the district would have to put his salary in the budget anyway. Good bye, $119,999! Today, The Seattle Times reports that the state of Washington is forfeiting a $13.2 million grant for Advanced Placement teachers because the people running the grant program want to pay teachers directly for participating in their training. The problem? “Washington’s collective-bargaining laws require that teacher pay be negotiated between unions and school districts.”

Our public schools, no matter what bureaucrats and unions tell us, are not underfunded. If they were, though, the whiners would largely have themselves to blame.

Bill Eilberg, a Club for Growth member who attended Cato University last year, sent this review into the Club blog:

I’m not one who easily sits through lectures, but at Cato University, I can honestly tell you that my attention span was at its highest level, as I listened more intently than I ever had done in college or law school.

I note that Rob McDonald is on the faculty again this year. Rob is one of the most talented speakers one will ever hear. His discussions on American history are positively riveting. I will never forget listening to his poignant account of how George Washington quelled a potential revolt by his officers, taking out his reading glasses to quote from a text (it is a story you may have heard already, but Rob is a master at retelling it). If I had the opportunity, I could listen to him for hours.

Bill is certainly right. Cato University gets rave reviews every year. Once again this July, it will be held at the beautiful Rancho Bernardo Inn near San Diego. Speakers will include Tom Palmer, Peter Van Doren, Gene Healy, and Michael Cannon of Cato. Reporting from around the world will be former Putin adviser Andrei Illarionov, German economist Karen Horn, elcato.org editor Gabriela Calderon, and Zimbabwean opposition leader Rejoice Ngwenya. And reporting from 1776, the aforementioned Professor McDonald.

Sign up now.

Florida lawmakers struck a deal (.pdf) to raise the cap on the state’s scholarship donation tax credit program by $30 million dollars last Friday, the last day of the legislative session. Under the program, businesses that donate to nonprofit scholarship organizations for poor children can claim a tax credit for the value of the donation. For the past seven years, these scholarships have been bringing private schooling within reach of families that couldn’t otherwise afford it.

But while the legislature has raised the cap on donations, that doesn’t meant the program will expand automatically. In order for the program to grow, more low income parents have to ask for the scholarships, and more businesses have to choose to make donations. The program is completely voluntary. So far, the interest definitely seems to be there: the program doubled in size over the past three years, to nearly 20,000 children.

Scholarship tax credits are a tremendous boon to low income families, businesses, and taxpayers all over the state. They broaden educational options for poor kids, let businesses directly help their communities, and for every student who chooses a private instead of a public school, they save taxpayers thousands of dollars. The maximum scholarship size allowed under the program will now be $3,950 (up from $3,750) – less than one third of total per pupil spending in Florida public schools (which was $12,263 in 2006-07, according to Richard Harbin of the Florida Dept. of Ed. — hat tip to my research assistant, Elizabeth Li).

The fact that parents are clamoring for a $4,000 scholarship to help their children escape from public schools that spend over $12,000 per year says a lot about the need for expanded educational options. No single system of schools can ever serve all children well. In education, as in so many other things, one size does not fit all.

Let’s hope governor Crist signs the new bill into law.

The back page of the Week in Review section of yesterday’s NYT features a symposium on “How to See This Mission Accomplished,” in which the Times asked nine experts to address problems going forward in Iraq.  Since at least five of the nine were enthusiastic backers of the war — and three work for the American Enterprise Institute — this is something like asking the captain of the Exxon Valdez* for his considered judgment on how best to conduct the cleanup.  Hey NYT: next time, why not consult someone who got it right? 

* Ironically enough, the Valdez’s Wikipedia entry places one “Able Seaman Robert Kagan” at the helm during the crash.  They’re everywhere. 

Not content with a protected near monopoly of the domestic market, American sugar producers are demanding that Congress make their pot of subsidies and protection even sweeter.

Chairman of the House Agriculture Committee, Rep. Colin Peterson (D-Minn.), is pushing language in the latest proposed farm bill that would raise domestic price supports for sugar and mandate that sugar imports be used for ethanol production.

His proposals would virtually lock in an 85 percent share of the U.S. market for domestic sugar beet and cane growers, even though a number of foreign countries can grow sugar more cheaply than most American growers. And by the way, did I mention that Rep. Peterson’s district is among the nation’s top producers of sugar beets?

The Bush administration, to its credit, opposes Peterson’s changes in the farm bill. The sugar industry, of course, loves the idea. A spokesman for the pro-protection American Sugar Alliance told this morning’s Wall Street Journal, “We have an administration that seems more interested in supporting foreign producers, than producers right here in America.”

Notice the sugar industry doesn’t mention American consumers. U.S. agricultural policies should not be about favoring “our” producers over “theirs,” but about advancing such national interests as freedom, prosperity, and a more peaceful world. As we’ve explained in detail at the Center for Trade Policy Studies, the U.S. sugar program favors American sugar producers primarily at the expense of the rest of America. American families pay higher prices at the store, while U.S. producers that use sugar as an input — bakeries, food processors, restaurants, candy makers, etc. — incur higher costs because of our sugar program.

As we read daily in the newspaper about soaring food prices, this Congress is the verge of passing a farm bill designed explicitly to raise domestic food prices.

Joining the National Conference of State Legislatures, the Association of Corporate Travel Executives has endorsed S. 717, the Identification Security Enhancement Act of 2007. This bill would reinstitute a negotiated rulemaking process regarding identity security that was established in the 9/11-Commission-inspired Intelligence Reform and Terrorism Prevention Act.

The FCC’s review of the XM-Sirius merger is a perfect example of the type of quagmire that’s inevitably created when a government agency is given broad, discretionary authority over private businesses. Various special interest groups have proposed that the merger be subjected to a laundry list of requirements. Lefty groups want an open device mandate. A rent-seeker entrepreneur named Chester C. Davenport wants the merged entity to set aside 20 percent of its spectrum for minority-controlled broadcasting. There are a variety of other proposals to require the firm to lease spectrum to unaffiliated entities. Clear Channel is demanding that it be subjected to the same “indecency” regulations that now plague terrestrial radio.

There are good arguments against each of these proposals, and there are some plausible arguments for some of them as well. But what I find most problematic about the situation is the way the proposals are handled. We have a constitutional system of government in which Congress is supposedly in charge of writing laws, the executive branch is in charge of executing them, and the courts are in charge of interpreting them. This ensures that laws are written by the most politically-engaged branch—Congress—and interpreted by the most impartial branch—the courts.

But in this case, as in many others, Congress has effectively given the FCC its blessing to wear all three hats. It can dream up new “conditions” (read: regulations) for the merger focusing on virtually any subject that strikes its fancy. The conditions are specific to one company, so there’s ample scope for favoritism and arbitrary decision-making. And once the conditions have been announced, and XM-Sirius have been blackmailed into “accepting” them, the FCC effectively wears executive and judicial hats as well. Yes, supplicants before the FCC can and do appeal decisions to federal courts, and the FCC is sometimes overruled. But the courts tend to give the FCC relatively wide deference in its policy decisions, and firms that practice regularly before the FCC may be reluctant to too aggressively defend their prerogatives in the courts for fear of souring their relationship with the FCC going forward.

The fundamental problem (aside from the courts’ failure to require that lawmaking powers be limited to Congress as required by the Constitution) is the FCC’s baroque process for apportioning spectrum. The right way to handle it would be for XM, Sirius, and every other broadcaster to have a property right in the spectrum they use, which would entitle them to do as they please with that spectrum (as long as it didn’t interfere with other broadcasters) or to lease or sell the spectrum to anyone else. In a world with genuine property rights, spectrum would find its way to owner with the highest-valued use, and anyone who wanted to enter a market like satellite radio would be able to do so simply be purchasing spectrum rights in the appropriate bands. The FCC’s role would be limited to keeping track of who held which license and verifying that spectrum uses did not create interference with one another.

My suspicion is that in such a world, satellite radio would prove economically infeasible because the spectrum would be more valuable in other uses. But I don’t know, and the FCC’s soviet-style spectrum allocation process is certainly not a good way to figure it out. The FCC should approve the XM-Sirius merger without conditions. But the more important lesson is that, Congress should be moving toward genuine property rights in spectrum, so that the 21st-century wireless market ceases to be micro-managed by an anachronistic 20th-century bureaucracy.

Once we have a real market for spectrum, Congress may choose to enact general regulations governing the use of that spectrum. But the current system, in which the FCC has the arbitrary power to single out individual companies for arbitrary restrictions on virtually any subject the FCC’s commissioners happen to be concerned with, is deeply flawed. It’s not fair to companies that have the misfortune of attracting the FCC’s scrutiny, and it’s not good for consumers, who are deprived of the benefits of a robust and competitive market for spectrum.

A letter writer in the Washington Post complains about this Post editorial, which criticized the repression in Cuba, particularly the lack of freedom of expression and the right to emigrate. The writer declares,

Cuba is managing its economy and is making incremental changes and reforms within its socialist and human-needs-oriented system. The U.S. government and The Post shouldn’t lecture Cuba when we have our own problems with the economy, the budget, health care, infrastructure and our moral standing in the world.

I’ve just published a book, most of whose 300 pages are devoted to criticisms of the U.S. government on a far wider range of issues than that, so I’m no knee-jerk defender of any government, much less of the Bush administration. But let’s take a closer look at the writer’s claims:

Cuba is managing its economy…

Well, every country manages its economy in some sense. The Cuban government has managed to turn a beautiful country of tropical beaches 90 miles from North America into one of the poorest countries in the world.

…and is making incremental changes and reforms…

Yes, as the Post editorial noted:

In the past few weeks, Cuban President Raúl Castro has introduced a handful of micro-reforms to the oppressive and bankrupt regime left behind by his brother. Cubans are now officially allowed to buy cellphones, computers and microwave ovens; state workers may get deeds to apartments they have been renting for decades; and farmers may be able to sell part of what they grow at market prices. The measures won’t have much impact (though they have evidently annoyed the officially retired Fidel Castro): The vast majority of Cubans can’t afford to buy electronic goods, and the agricultural reforms fall short of steps taken years ago by North Korea.

So reforms are good. Wake me when they reform more than North Korea.

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Today, Cuba officially lifted its ban on the sale of computers to the general public. Some other prohibitions have also been scrapped in recent weeks: Cubans can now buy cell phones, stay in hotels previously reserved for tourists, and buy appliances like microwaves and TV sets.

Is this a sign of openness from Cuba’s geriatric regime? Not so.

A Cuban dissident I met in Havana last year sent me today an article he wrote about the real motive behind relaxing these bans. It has been reported in the state-controlled media that people purchasing these goods are later being investigated by the authorities who want to know the real sources of their income. As it’s widely known, the average Cuban salary is less than $20 a month, while the cost of most of these goods ranges in the hundreds of dollars. Many Cubans get their extra money from relatives in the United States, but many others run independent (and illicit) small businesses.

My friend tells the story of the first person to purchase an electric bicycle, which cost the equivalent of $1,070. This man had a small butter factory that apparently was very profitable, since he was selling the butter at a lower price than the government. After buying his electric bicycle, the authorities investigated him and discovered his factory. They proceeded to confiscate everything they found in his home, including the bike.

Let’s not forget that, after all, there is still a Castro brother running the show on the island. As my Cuban friend says about the so-called “reforms,” the fact that something is no longer prohibited doesn’t mean that you can do it.

The Goldwater Institute’s Matt Ladner has a great post over at Jay Greene’s new blog explaining how we should be delivering education — both in the sense of how we should be providing educational services, and how we should be delivering our children’s education from the shackles of monopoly.

Faced with the prospect of years in prison, Deborah Jeane Palfrey, known as the “D.C. Madam,” committed suicide on Thursday. Her pursuers and prosecutors should be ashamed of themselves.

Running a house of prostitution is not a distinction most of us would wish for our daughters. But it’s a vice, not a crime. That’s a crucial distinction in a free society. So far as we know, she never murdered, raped, assaulted, robbed, or defrauded anyone. Like any broker, she brought together willing buyers and willing sellers. And for doing so, she was convicted–not actually of prostitution but of “racketeering” and money laundering — and faced up to 55 years in prison, though prosecutors estimated that her sentence would likely be “only” four to six years.

Palfrey was indicted after a three-year joint investigation by the Internal Revenue Service and the U.S. Postal Service. Apparently they couldn’t catch her cheating on her taxes, but her employees mailed her cut of the proceeds in money orders, which led to racketeering and money laundering charges. As with former New York governor Eliot Spitzer, apparently a fishing expedition into money matters turned up something far more headline-worthy.

But really — a three-year investigation of a prostitution service? Are there no real criminals? Are there no terrorists? Before, during, and after 9/11, the Justice Department ran a 13-month investigation of a brothel in New Orleans. At least 10 FBI agents were involved. As Jonathan Turley noted, “Only the FBI could go to the French Quarter and find only a dozen prostitutes after a year of investigation. Given the roughly one-to-one ratio between agents and prostitutes, the FBI could have produced a hundred times this number by simply having agents walk down Bourbon Street.” What a ridiculous waste of money and manpower.

But the waste is not the worst aspect of this outrage. Even if there were no criminals and no terrorists to hunt down, it would be wrong to harass, arrest, prosecute, imprison — and hound to death — people who are violating no one’s rights.

There’s a nightmarish intersection of old prostitution laws and modern financial regulations. Palfrey was investigated on suspicion of tax evasion and then convicted of “racketeering” and “money laundering.” But she was no racketeer; she was one woman with some employees or contract workers. Spitzer’s bank accounts were being monitored, as apparently all our bank accounts are, under post-9/11 laws allegedly designed to turn up evidence of terrorist financing or other nefarious activity. And boy, did they find something sinister — a married man having sex with prostitutes.

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