Archive for October, 2007
Anti-Immigrant Opinions are Weakly Held
I didn’t watch Tuesday’s Democratic debate — watching politicians from either party outbid each other on faux outrage and how much of my money they would spend is too annoying — but I did get the after-action report on the Newshour. And it seems Senator Clinton was drawn into the vortex New York Governor Eliot Spitzer (D) created with his recent flip-flop on driver licensing and public safety.
His original decision to de-link driver licensing and immigration status for public safety reasons was right, but it was pounced on and demagogued by anti-immigrant groups. Spitzer backed down, and pledged his state to implement the REAL ID Act, pleasing nobody. (When the costs of this national ID law to New York are discovered, he’ll flip-flop again, earning quiet, broad-based appreciation.)
Watching the excerpts of the candidates bumbling around this issue, it appeared to me that they knew giving licenses to illegal immigrants is the right and practical thing to do, but also that they would get demagogued if they said so.
Well, here’s my advice: Go ahead and say it.
Having watched this issue, and having heard from lots of angry people, I know that anti-immigrant views are a classic weakly held opinion. Angry as people are about the rule of law and “coming to this country the right way,” that anger melts when they learn more. Stuff like this:
“We haven’t permitted anywhere near enough legal immigration for decades. You can sit back and talk about legal channels, but the law has only allowed a smidgen of workers into the country compared to our huge demand. Getting people through legal channels at the INS has been hell.
“America, you’re going to have to get over what amounts to paperwork violations by otherwise law-abiding, honest, hard-working people. And that’s what we’re talking about – 98% honest, hard-working people who want to follow the same path our forefathers did, and who would be a credit to this country if we made it legal for them to come. Our current immigration policies are a greater threat to the rule of law than any of the people crossing the border to come here and work.”
This kind of argumentation will be met with vicious demagoguery, which will weaken, and weaken, and fade and fade and fade. The people I hear from — and I regularly do because of the educating I’ve been doing nationwide on the REAL ID Act — immediately soften when I pull them from their echo chambers. The “rule of law” hand is a low pair compared to this full house: “honest, hard-worker from impoverished circumstances, denied legal channels other than a narrow chance of navigating an incompetent bureaucracy.”
There’s one Democratic candidate who is well suited to make this kind of argument. It’s a way to draw attention, look principled, do the right thing, and vanquish a loud but weak pressure group. New Mexico’s uninsured driver rate dropped by two-thirds — from 33% to 11% — when that state delinked immigration status and driving in 2003.
Meltdown at the State Department
I had been wondering how long until members of the foreign service started voicing their concerns about possibly being drafted to go to Iraq. Answer: Less than a week.
In a contentious hour-long “town hall meeting” called to explain the step, these workers peppered the official who signed the order with often hostile complaints about the largest diplomatic call-up since Vietnam….
[...]
Employees directly confronted Foreign Service Director General Harry Thomas, who approved the move to so-called “directed assignments” late last Friday to make up for a lack of volunteers to go to Iraq.
“It’s one thing if someone believes in what’s going on over there and volunteers, but it’s another thing to send someone over there on a forced assignment,” [Senior FSO Jack] Crotty said. “I’m sorry, but basically that’s a potential death sentence and you know it. Who will raise our children if we are dead or seriously wounded?”
“You know that at any other (country) in the world, the embassy would be closed at this point,” Crotty said to loud and sustained applause from the about 300 diplomats who attended the meeting in a large State Department auditorium.
Sounds like they’d have a hell of a time trying to develop some kind of standing nation-building office at State.
White House ‘Orders’ on the Way
Today’s Washington Post reports that the White House is increasingly frustrated with the Congress because the president and congressional leaders just can’t agree on a legislative agenda. To get around this “problem,” White House officials say the president is going to step up the issuance of “administrative orders,” which is probably a euphemism for Clintonian executive orders.
When a Republican Congress put the brakes on Bill Clinton’s ambitions, Clinton’s people came up with the idea of executive orders. It wasn’t a new idea, but they were going to take it to whole new level. Conservatives were rightly fuming when a boastful Paul Begala said, “Stroke of the pen, law of the land. Kinda cool.” If Dick Cheney or Karl Rove repeated those words tomorrow, one wonders how it would be received in political circles. What would Rudy Giuliani say? Would Hillary try to feign outrage?
For Cato scholarship on executive orders, go here.
Expanded Trade Adjustment Assistance Passed in House
Following on from my earlier post, the U.S. House of Representatives just passed the Trade and Globalization Assistance Act of 2007, although with insufficient votes to override a veto, as threated in yesterday’s Statement of Administration Policy (available here). The new legislation would roughly double the level of federal spending on the trade adjustment assistance program, by expanding the income and health care benefits to new categories of workers and increasing training (keep in mind this is the same program that the Government Accountability Office has admitted was “ineffective”).
TAA moves on to the Senate next, where we might see a bit more of a fight: the Chair and Ranking Member of the Senate Finance Committee are at odds over possible changes to the program.
[Hat tip: Our crack Government Affairs team.]
Rudy Was Right
Today’s Washington Post takes Rudy Giuliani to task for a radio ad in which he claims that the chances of surviving prostate cancer are roughly twice as high in the United states than under Britain’s system of socialized medicine. The Giuliani campaign cited as its source an article by Manhattan institute scholar David Gratzer, which the Post pointedly notes “provides no source for its assertion.” However five minutes of research might have shown the Post that the numbers actually come from a Commonwealth Fund study by Gerard Anderson and Peter Hussey.
Moreover, the Post’s own figures, using more recent numbers and a different methodology, show that the five year survival rate for prostate cancer to be 98 percent in the U.S. and 74 percent in Great Britain. Not quite as good as Rudy’s numbers, but still a clear advantage for the U.S.
The Post also suggests that the better U.S. outcome is a reflection of “different philosophies about how to treat the disease.” Indeed! I think that is Rudy’s point.
The one valid criticism of Rudy’s point is that prostate cancer might not be the best example of outcome disparities between the two systems. Because prostate cancer is a slow-growing cancer, the disparity may reflect more aggressive testing and screening procedures in the U.S. That is, we catch many cancers that would go undetected in other countries. As, Robert Ohsfeldt and John Schneider concede in their book, The Business of Health:
[Many] cancer survival rate estimates…do not adjust for cancer stage at diagnosis. This could result in survivor time bias – those with cancers detected at an earlier stage would exhibit longer post diagnosis survival times, even for cancers that are essentially untreatable.
Survivor time bias, however, should not be a significant concern for cancers that respond well to treatment if detected early. For such cancers, early detection makes a substantive contribution to survival time – the longer survival time associated with early detection thus is not a spurious effect of early detection. An example is thyroid cancer. In the United States, virtually all females with thyroid cancer survive for at least five years. The lower survival rates for thyroid cancer in European countries suggest some underperformance in either early detection or post diagnosis management in these countries. In contrast, the differences in survivor rates are less pronounced for cancers that are more difficult to treat, such as lung cancers.
U.S. outcomes beat the U.K not just for prostate cancer, but for a wide variety of cancers and other diseases, where survivor time bias is not at issue. According to a study published this year in the British medical journal, The Lancet, for all types of cancer, the U.S. ranks number one among industrialized nations: 62.9 percent of women with cancer survive for 5 years, 66.3 percent of men. Britain ranked 16th for women (52.7 percent) and 15th for men (just 44.8 percent).
Besides, one of the most common arguments for socialized medicine is that it would lead to more testing, screening, and preventive care. Proponents of government-run health care can’t have it both ways.
For this one, it looks like the Post deserves “four Pinocchio’s.”
So Write a Check and Shut Up, Warren
When billionaires piously say that they should pay more taxes, the rest of us should hide our wallets. Warren Buffett, the so-called “Sage of Omaha” says his tax rate is too low. That’s a strange attitude, to be sure, but if Buffett wants to write an extra check to the government, he should go right ahead. Heck, the Treasury Department even has a website with a mailing address for people who are foolish enough to flush more of their money into the Washington sewer. Unfortunately, Buffett’s real agenda is to agitate for higher tax burdens for the rest of us. As the UK-based Guardian reports:
The United States’ second-richest man has delivered a blunt message to the Bush administration: he wants to pay more tax. Warren Buffett, the famous investor known as the “Sage of Omaha”, has complained that he pays a lower rate of tax than any of his staff – including his receptionist. Mr Buffett, who is worth an estimated $52bn (£25bn), said: “The taxation system has tilted towards the rich and away from the middle class in the last 10 years. It’s dramatic; I don’t think it’s appreciated and I think it should be addressed.” … Buffett’s remarks drew a robust response from the US Chamber of Commerce, which said the top 1% of US earners accounted for 39% of tax revenue – and the highest earning 25% of the population delivered 86% of the tax-take.
The Chamber of Commerce correctly notes that the tax code already is heavily biased against rich people, and it certainly is true that higher tax rates will hinder economic performance and make America more like Europe (which would hurt receptionists more than billionaires). But the reporter should have done some simple fact checking and discovered that Buffett has no idea what he’s talking about regarding tax rates. I addressed this issue back in June, in response to another Warren-wants-the-rest-of-us-to-pay-more episode:
It is probably safe to assume that Buffett receives lots of dividend income and that he also declares a considerable amount of capital gains, both of which are subject to a 15 percent tax rate on an individual tax return. What he did not mention, however, is that corporations pay a 35 percent tax before distributing dividends to shareholders, so the actual effective tax rate on that portion of Buffett’s income is closer to 50 percent.
The capital gains tax is another example of double taxation. An increase in the value of a stock is a reflection of an anticipated increase in the future income stream from that stock. Yet that income stream will be taxed (usually two times!) when it occurs. The real effective rate on that portion of Buffett’s income is harder to calculate, but it certainly will be far higher than 15 percent.
Shifting gears, Buffett’s calculations almost surely include Social Security payroll taxes, which only apply to the first $90,000 of income in exchange for not providing huge benefit payments to rich retirees. Indeed, the overall program is highly progressive once benefit payments are added to the equation, so Buffett’s secretary gets a better deal than he does from Social Security (though both would be better off with a system of personal retirement accounts).
Tax-and-Spend or Borrow-and-Spend?
Pat S. Herrity wants a new elementary school and middle school for southern Fairfax County. Douglas R. Boulter wants to hire more zoning inspectors. Vellie S. Dietrich Hall calls for more and better-paid police. Gary H. Baise promises roads, an expanded auditor’s office and the newly created post of county ethics officer.
And they all pledge to lower property taxes.
Meet the Republicans running for the Board of Supervisors on Nov. 6.
In Virginia, as in Congress, voters get a choice between tax-and-spend Democrats and borrow-and-spend Republicans. As I’ve argued before, there’s a bit of fat in the Fairfax County budget. It’s too bad that voters aren’t offered any candidates who would trim it.
Paul Krugman and the Unbearable Lameness of Partisanship
In a recent appearance on bloggingheads.tv with Mark Schmitt, I expressed disdain for the current spate of conservative-bashing books by Jonathan Chait, Greg Anrig, and Paul Krugman. Now don’t get me wrong: conservativism deserves some fairly spirited bashing these days. But what I objected to about these books was their crude partisanship — specifically, their grossly distorted, black-hats-versus-white-hats version of recent American political history.
I didn’t get a chance there to flesh out my criticisms in any detail, so I’d like to do a little bit of that here. And thanks again to bloggingheads.tv (if you’re not familiar with it, it’s really a terrific site), I’ve got an excellent jumping-off point: an interview of Paul Krugman by none other than Mario Cuomo. Cuomo, it turns out, is an excellent interviewer, carefully drawing out Krugman’s views and gently challenging him at a number of points. And the picture of Krugman that emerges is one of a man completely besotted with ideological enthusiasm.
You have to remember who Paul Krugman is, or at least who he was: an immensely talented economist, winner of the John Bates Clark medal, capable of analytical ingenuity at the most rarefied level and simultaneously a gifted popularizer of complex economic ideas. So how can someone with so much brainpower, with such talent for subtlety and insight, say something like this? Or this?
Let’s focus on these two snippets. In the first, Krugman says that the middle-class society he grew up in (i.e., the American political economy of the quarter-century after World War II) did not evolve by the invisible hand of the market; it was created by FDR and the New Deal. Meanwhile, the “second Gilded Age” we now live in (i.e., the American political economy of the past quarter-century) was created by Reagan and other right-wing politicians.
And in the second clip, Krugman defines liberalism as the idea that we are our brothers’ keepers, and that government needs to ensure a basic minimum for all citizens. Conservatives, on the other hand, believe “you’re on your own.”
In these clips we see, not subtlety or insight or analytical ingenuity, but the Manichean worldview of the true believer: one mass political movement, defined by its noble intentions, accomplishes unalloyed good, while a rival mass political movement, motivated by base and selfish values, works to undo that good. Read the rest of this post »
In Utah, You Work for the UEA
On November 6, Utahns will vote on a referendum to decide the fate of a statewide voucher program passed by the Utah legislature and signed by the governor earlier this year. As anyone who knows anything about public schooling would have predicted, the major force fighting against choice has been teacher unions, with the National Education Association (NEA) having donated at least $1.5 million to date to the anti-choice cause. And, as this article in yesterday’s Salt Lake Tribune makes clear, defeating choice is an obsession for the state’s NEA affiliate, the Utah Education Association (UEA). Of course it is, because monopolists will stop at nothing to protect their monopoly. But this begs a question to which almost everyone must already know the answer, but many just won’t admit it: Who really works for whom? Do public school teachers work for the public, or does the public really work—and pay taxes—for the teachers?
The answer is all too clear, and that alone ought to make people in Utah, and around the country, support as much school choice as they can get.
Corporate Tax Cut Revolution Continues
From the Canadian Financial Post:
The Conservative government delivered a mini-budget yesterday that lowered the Goods and Services Tax for a second time and reduced corporate taxes by one-third over the next five years as part of a $60-billion multi-year package of tax cuts…Perhaps the biggest surprise was Mr. Flaherty’s commitment to cut the corporate income tax rate deeper than planned, from its current 22.1% to 15% in 2012.
To put this in context, $60 billion over five years means about $12 billion per year. Since the American economy is about 10 times larger, the equivalent cut here would be about $120 billion per year, which is pretty big cut.
The average federal/provincial corporate tax rate in Canada today is 36%. Thus, cutting the federal rate by 7 points should drop the average combined rate to about 29%. By contrast, the combined U.S. federal/state rate is about 40%.
Here’s the interesting political part:
Liberal leader Stéphane Dion said his party would not oppose the measures, ensuring they receive Parliamentary approval as early as today…The proposal comes as Mr. Dion toured the country arguing for lower business rates and promising, if elected, to take the general corporate rate lower than the 18.5% the Conservative government had initially proposed.
That’s the Liberal party leader, in a country where “liberal” used to mean left-of-center statist. It seems that everywhere but Washington, the times are a changin’.
Former Narcotics Cop Creates a Tell-All Video
Barry Cooper was a narcotics cop in Texas who made countless arrests. But when he started busting the relatives and friends of politicians, he found himself in trouble with the law. Disgusted with this turn of events, Cooper came up with an idea to get even with the authorities. He created a DVD called Never Get Busted Again. The DVD reveals dozens of ways to avoid detection and arrest by narcotics officers. The DVD is causing a stir in law enforcement circles, but Cooper is unbowed. He has plans for another DVD called Never Get Raided Again. Interestingly, Cooper admits that he feels quite guilty about raids that he was personally involved in: “I used to break into houses at three o’clock in the morning with 10 other men, after throwing a flash grenade through the window,” Cooper says. “I would drag Mom and Dad away and send the kids to the department of human services — over a bag of pot — and totally ruin that entire family.” And those are just the raids where no one is injured or killed. Cato has documented plenty of raids that go awry.
In my book, After Prohibition, three former law enforcement officers explain how they started out as drug warriors but eventually came to the view that the drug war was not only not working, but it actually has disastrous side-effects. Colorado Sheriff Bill Masters is another example. Early in his career, Masters received awards from the DEA for his drug busts. Later, Masters turned against the war and wrote a terrific book called Drug War Addiction. There are so many cops breaking ranks these days, that there is now an organization called Law Enforcement Officers Against Prohibition (LEAP).
For Cato scholarship on the drug war, go here. I also recommend this recent essay by Ethan Nadelmann. And for more info on how to handle yourself in a confrontation with the police, go here.
Update: Several individuals who work in the drug reform movement have emailed me to say that they dispute the quality and accuracy of Cooper’s Never Get Busted Again DVD. I thank them for alerting me and wanted to pass it along. Buyer beware. For what it’s worth, I can and do recommend the Busted DVD from Flex Your Rights.
Halloween Fright From Iowa Tax Collectors
Trick-or-treating just got a bit more expensive thanks to the hobgoblins at the Iowa Department of Revenue. The tax-hungry bureaucrats have decided to tax pumpkins because they are used for decoration instead of food. Yahoo.com reports:
The Iowa Department of Revenue is taxing jack-o’-lanterns this Halloween. The new department policy was implemented after officials decided that pumpkins are used primarily for Halloween decorations, not food, and should be taxed, said Renee Mulvey, the department’s spokeswoman. …Previously, pumpkins had been considered an edible squash and exempted from the tax. The department ruled this year that pumpkins are taxable — with some exceptions — if they are advertised for use as jack-’o-lanterns or decorations.
But in the glorious tradition of bureaucracies everywhere, there is a form to fill out – at least for taxpayers who eat pumpkins:
Iowans planning to eat pumpkins can still get a tax exemption if they fill out a form.
This sounds like added bureaucracy, but Iowa taxpayers should be happy. By this time next year, the bureaucrats will decide that some people are falsely claiming that they are eating pumpkins in order to dodge the tax. So the new form will require families to send in photos of pumpkin pie. The following year, some bureaucrat will decide that some of the pies were actually bought in stores, so tax exemptions will only be allowed if a bureaucrat is invited over for dinner. I’m just kidding, of course. At least I think.
On a more serious note, special tax exemptions for pumpkins based on their use is symptomatic of why the tax code is a mess. It’s a mess in Washington, and it’s a mess in the states. The common thread in all cases is that politicians try to micro-manage the economy (and raise campaign cash) by imposing penalties and creating loopholes. The ultimate victims are the small business owners who now will have even more of their time consumed by bureaucratic nonsense:
Kautz, who has owned his farm for seven years, was particularly dismayed with the notion of requiring customers to fill out a form verifying that they planned to eat the pumpkins they were buying. “It’s another crazy, crazy, stupid thing,” he said. Kautz said he will estimate how many pumpkins were bought for non-food purposes, and then will send the tax on that amount to the revenue department. “It gets unfeasible for people to have small businesses,” he said. … Other Iowa pumpkin sellers also expressed confusion about the new policy. … None said they are asking customers to fill out the tax-exemption certificate.
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