Archive for July, 2008
Maryland Meets the Laffer Curve
Greedy politicians in Annapolis doubled the cigarette tax in Maryland for the ostensible purposes of reducing a budget deficit and financing more government spending. They increased spending (of course), but their tax hike is not generating much additional revenue. As the Washington Post reports, consumers are adjusting their behavior to minimize their tax burden:
Cigarette sales have dropped by nearly 25 percent in Maryland since the state’s tobacco tax doubled in January, as sticker shock apparently has curtailed some residents’ smoking and sent others across the border for better deals. Maryland lawmakers voted last fall to raise the tax to $2 a pack to help bridge a budget shortfall and expand subsidized health care. Fiscal analysts predicted that the new rate, the sixth highest in the nation, would cause cigarette sales to drop off, following a pattern with past increases. But the decline during the first six months of the year significantly exceeded their projections, exacerbating Maryland’s budget problems… Legislative analysts say they are looking at the degree to which Marylanders are crossing borders to buy cheaper cigarettes. It seems to be happening to some extent. On a recent afternoon, two service stations along South Dakota Avenue NE in the District were packed with vehicles with Maryland tags, many belonging to commuters heading to Maryland by Route 50 or the Baltimore-Washington Parkway. “The tax is not going to stop people from buying cigarettes,” said Mike Brockington, a 40-year-old Prince George’s County resident, adding that he was purchasing cigarettes in the District because of Maryland’s tax increase. … Maryland law seeks to limit out-of-state cigarette purchases. It is illegal for Maryland residents to be in possession of more than two packs of cigarettes lacking stamps showing that taxes were paid in the state.
Filed under: General; Regulatory Studies; Tax and Budget Policy
The Mysterious Mr. Obama
Yesterday, one minute apart, I received two email messages that sort of sum up the mixed libertarian views on Barack Obama. First, an old friend forwarded an AP story in which Obama promised to repeal any executive orders that “trample on liberty”:
Barack Obama told House Democrats on Tuesday that as president he would order his attorney general to scour White House executive orders and expunge any that “trample on liberty,” several lawmakers said. . . .
The Illinois senator “talked about how his attorney general is to review every executive order and immediately eliminate those that trample on liberty,” said Rep. Jerrold Nadler, D-N.Y.
Good stuff! Let’s just hope he realizes that Bush isn’t the first president to issue executive orders that “trample on liberty.” It was President Bill Clinton’s aide, Paul Begala, who drooled at the notion of using executive orders to do what Congress wouldn’t go along with: “Stroke of the pen. Law of the land. Kinda cool.” For a look at some pre-Bush executive orders that might warrant elimination, Obama’s attorney general might consult “Executive Orders and National Emergencies: How Presidents Have Come to ‘Run the Country’ by Usurping Legislative Power,” published by Cato in 1999. There he can find information about Clinton orders that nationalized land, sought to reverse Supreme Court rulings, rewrote the rules of federalism, and waged war in Yugoslavia.
One minute after receiving that story, I received another Obama analysis in my inbox. That one was an editorial from Investor’s Business Daily titled “Barack Obama’s Stealth Socialism.” The editorial noted Obama’s repeated use of the sneaky phrase “economic justice” and cited a laundry list of spending programs and regulations that Obama supports. It’s a pretty scary list for a libertarian, from national health insurance and penalties for companies that do business internationally to huge new federal burdens on employers.
To the extent that some libertarians look favorably on Obama, I think it’s mostly negative: Bush and the Republican Congress have been so bad that any alternative looks good. But occasionally Obama does indeed say something almost libertarian. And then he promises that he’s the guy who can build a consensus to actually implement Hillary Clinton’s policy agenda, and libertarians are reminded of why they rarely vote Democratic. In Obama’s case, of course, the confusion is created by his lack of much public record. He was a senator for only two years before he began running for president full-time. Unlike candidates such as Clinton and John McCain, he doesn’t have decades’ worth of votes and statements to review. So we parse the substantive moments amid his soaring rhetoric and try to determine if he’s “the most liberal member of the Senate,” “more to the left than the announced socialist in the United States Senate, Bernie Sanders of Vermont,” a “a pro-growth, free-market guy,” or even a “left libertarian.”
Filed under: General; Government and Politics; Political Philosophy
Typical Bad Advice from the IMF
The International Monetary Fund has a dismal reputation for peddling snake-oil economic advice, with higher taxes and currency devaluation always high on their list. Sometimes, I wonder whether that is an unfair characterization, but then I see that their latest analysis of the Japanese economy endorses higher taxes. Tax-news.com has a summary:
While welcoming the efforts being made by the Japanese government to balance its budget by 2011, the International Monetary Fund (IMF) said on Tuesday that consumption tax may have to be raised to curb public debt and absorb rising social security costs. “Larger fiscal adjustments than currently envisaged by the authorities will be required to stabilize the high public debt and make room for the fiscal costs of population aging,” the IMF stated in its Article IV report on the Japanese economy. According to the Fund, with limited scope for further expenditure cuts, future fiscal consolidation will compel the Japanese government to raise more revenues.
The adding-rhetorical-insult-to-policy-injury aspect of the IMF report is the deceptive and dishonest choice of words. Higher taxes are needed to “make room for the fiscal costs of population aging,” the IMF admonishes. Did the bureaucrats never consider that entitlement programs should be reformed to “make room” for the amount of available tax revenue? The IMF also writes in the report that “Expenditure cuts are nearing their limit and further fiscal consolidation will require tax measures, yet OECD data shows that government spending this year is consuming more than 36 percent of GDP, which is a bigger burden than two years ago (and much bigger if compared to the size of government 20 years ago, 30 years ago, etc). Perhaps the IMF should not make such foolish statements until the government of Japan actually reduces spending rather than increasing it.
Filed under: General; International Economics and Development; Tax and Budget Policy
Milton Friedman on Drug Prohibition
Since it’s Milton Friedman’s birthday today, take a moment to watch this brief video clip. It is an interview conducted by our friends at the Marijuana Policy Project shortly before Dr. Friedman passed away.
For related Cato work on the disastrous drug war, go here.
State Government Spending and Borrowing Is Soaring
The Department of Commerce released second quarter national income data today. The data includes estimates of state and local spending and revenues. (See Table 3.3)
Here is what I found comparing the first two quarters of 2008 with the first two quarters of 2007.
- State and local tax revenues have grown about 2.1 percent over last year, with personal income taxes up 4.2 percent and property taxes up 4.3 percent. (I say “about” because I estimated the missing data item for corporate tax revenues).
- State and local total expenditures have soared 6.8 percent over last year.
There are two items of interest here. First, leading newspapers have been running stories in recent months about the horrible cutting and slashing going on in state budgets. With spending growth at about 7 percent, such budget downsizing is apparently not widespread, to say the least.
Second, the gap between spending at about 7 percent and revenues at about 2 percent is curious, given that state governments are supposed to balance their budgets each year. The explanation, according to the Commerce data, is that state and local government borrowing is soaring.
Federal Reserve data confirm the state/local government borrowing binge. See Table D.3.
Steve Chapman on Consent Searches
Steve Chapman takes a look at the problem of ‘voluntary’ roadside searches. Excerpt:
If I approach as you pull into a parking space and ask if you’d mind my rummaging through your car, the chances are at least 90 percent that you’d decline. But if a police officer stops you with the same request, the chances are higher than 90 percent that you’d agree. Something about that badge makes citizens eager to be helpful.
Or maybe not. In civics class and 4th of July speeches, we are told that American democracy rests on the consent of the governed. But interactions with the police serve as a useful reminder that government rests less on voluntary cooperation than on fear and force. A nation is free to the extent it prevents the rulers from bullying and coercing the ruled. By that standard, American society still has a way to go.
Read the whole thing.
Learn what your rights are. Get the Busted dvd. Related Cato work, here.
It’s Midnight in America
You could be excused for getting that vibe from this McCain campaign video, what with its vaguely X-Files-esque theme music and apocalyptic imagery (am I the only one who finds the little girl picking flowers reminiscent of “Daisy” the famous anti-Goldwater ad from the ‘64 campaign?). The Teddy Roosevelt tape is from TR’s unhinged speech to the 1912 Progressive Party convention, a speech that ends “we stand at Armageddon–and we battle for the Lord!”
Election 2008: the Messiah vs. the Prophet of Doom. Sigh. Whatever happened to normalcy? Where have you gone Warren Harding? A nation turns its lonely eyes to you.
EPI Gets Trade and Jobs Story Wrong Again
According to a report released today by the Economic Policy Institute, trade with China has caused a loss of 2.3 million American jobs since the Asian giant joined the World Trade Organization in 2001. The study will get a lot of coverage, but its numbers and methodology are shockingly flawed.
This is a well-traveled road for EPI and the report’s main author Robert Scott. Scott has authored other reports that have come to the same conclusion about NAFTA and earlier periods of trade with China. The methodology virtually guarantees a finding of job losses: It assumes that imports displace a certain number of workers while exports create new jobs, and since we run trade deficits with China and Mexico—surprise!—trade with those countries leads to net job losses.
I’ve dissected the flaws of EPI’s approach elsewhere, but to just summarize what everyone should keep in mind when you read about the EPI report:
EPI exaggerates the number of American companies and workers who compete directly against Chinese imports. Many of our main imports from China—shoes, clothing, toys, and consumer electronics—were being imported from other countries before China’s emergence as a major supplier. In fact, as imports from China have risen since 2001 as a share of total imports, imports from other Asian countries have been in relative decline. So imports from China do not typically displace U.S. production but instead displace imports from other countries. In fact, in the past year, the U.S. unemployment rate has been heading up as our overall trade deficit has been heading down.
EPI ignores the creation of jobs elsewhere in the economy that are made possible by trade and globalization. Exports aren’t the only channel through which trade and globalization creates jobs. Foreign capital flowing into the United States—the flip side of the trade deficit—creates jobs through direct investment in U.S. companies and indirectly by lowering interest rates, which stimulates more domestic investment.
Even when trade does displace workers, in a flexible and growing economy, new jobs will be created elsewhere. As I reported in my October 2007 study “Trading Up,” job losses in manufacturing during the past decade have been more than offset by net job gains in better-paying services sectors.
Since China joined the WTO in 2001, U.S. exports to China have shot up by 22 percent per year, the U.S. economy has added a net 6 million new jobs, real compensation per hour earned by U.S. workers—that is, wages plus benefits adjusted for inflation—is up 9 percent, and manufacturing output is up 10 percent. Last year, America’s supposedly beleaguered manufacturers earned collective profits of $305 billion, more than five times what they earned the year China joined the WTO.
As we struggle through a domestic slowdown and rising prices for consumers, we could use more trade with China, not less.
Filed under: International Economics and Development; Trade
The Stevens Scandal
Don Boudreaux of George Mason University sent out the following missive about Ted Stevens’s indictment. I don’t see it posted at Cafe Hayek, though it might yet be. But since I can’t improve on his pithy commentary, I offer it here:
I’m delighted to see Sen. Ted Stevens face jail time for his crimes while in office. To charge him with concealing gifts totaling $250,000, however, is the equivalent of charging a confessed mass murderer with jaywalking. If that’s the only way to bring the criminal to justice, fine. But Sen. Stevens’s most significant misdeeds - ones of which he boasts! - are his decades-long success at directing billions of taxpayer dollars to special-interest groups for no reason other than the fact that he possessed the power and position to buy himself even greater security in office by doing so.
Of course, punishing all the criminals guilty of THAT offense would depopulate Capitol Hill.
Filed under: General; Government and Politics; Law and Civil Liberties; Tax and Budget Policy
Building Afghanistan
Building a state in Afghanistan is the job of the Afghans. The United States can help, especially with infrastructure projects and military training, but our principle objective there should not be counter-insurgency, but counter-terrorism. That mission requires no surge in American or NATO forces.
Don’t take it from me, take it from Rory Stewart, the crazy Scotsman and former employee of the British Foreign Office, who walked across Afghanistan in 2002 with a dog, lived to write a great book about it, and now lives in Kabul.
Stewart’s article is latest in an outbreak of Afghanistan surge skepticism.
Treating Angelenos as Children
A law that would prevent fast-food restaurants from opening in South Los Angeles neighborhoods was unanimously approved by the LA City Council on Tuesday.
Paternalist? You bet. Violation of equal protection? It would seem so. The City Council trusts white people, but not the blacks and Latinos who live in South Los Angeles, to make their own food decisions? Ouch.
But I was particularly struck by this statement from Councilwoman Jan Perry, sponsor of the measure: “I believe this is a victory for the people of South and southeast Los Angeles, for them to have greater food options.”
Greater food options? All the council is doing is banning some restaurants. How will that give residents more options? Maybe — maybe — other restaurants will open in South Los Angeles because fewer fast food restaurants will open over the coming year. But residents will still not have “greater food options,” just different options, courtesy of those who know best.
Thomas Sowell wrote in Knowledge and Decisions of the “surprising . . . persistence and scope of the belief that people can be made better off by reducing their options.” Twenty-eight years later, the belief persists. But now people who reduce other people’s options claim they are increasing options. That’s progress, of a sort.
The citizens of South Los Angeles should rebel against the unchosen nannies who think that they can run adults’ lives better than those adults can run their own lives.
Depth Takes a Holiday
In yesterday’s New York Times, David Brooks lamented the yawning chasm in educational attainment that divides America: the children of wealthy and highly-educated parents graduate from high school and go on to college vastly more often than those of lower-income, less educated parents. Here, he is on solid ground. But, columnists being columnists, Brooks goes on to give us his unsubstatiated opinion that: “Barack Obama’s education proposals… flow naturally and persuasively from this research,” while “McCain’s policies seem largely oblivious to these findings,” as exemplified by the Republican’s “vague talk about school choice.”
A look at the evidence reveals Brooks’ intuition to be exactly backwards.
Senator Obama’s education platform can verily be described as more of what the federal government has already been doing: more spending on government pre-school programs aimed at ever-younger children, especially the fifty-year-old Head Start program; tweaking of the No Child Left Behind act to make it look a little more like it did in its first four decades, when it went under the name Elementary and Secondary Education Act., etc.
But these programs were in full blown operation during the entire period, from the seventies to the nineties, during which Brooks notes that ”America’s educational progress slowed to a crawl.” So Brooks is arguing that doing more of the same is a “natural” and “persuasive” solution to our longstanding educational problems. His hope in this regard is indeed audacious.
And what of McCain’s “vague talk” about private school choice programs? Is it really irrelevant to the educational attainment gap that Brooks is so concerned with? If Brooks had spend just a few minutes Googling the issue he would have come across the nationwide study by University of Chicago economist Derek Neal showing that urban African Americans are vastly more likely to graduate from high school, gain acceptance to college, and graduate from college if they attend Catholic rather than public schools. He would have found the similar findings by Evans and Schwab. He might even have come across the two separate studies of the Milwaukee voucher program showing significantly higher graduation rates for the poor students attending private schools under that program than for students in the Milwaukee public school system.
People who actually care about the socio-economic divide in our nation should familiarize themselves with the evidence before trying to influence public opinion on presidential candidates or policies.
E-Verify: More Study Needed
Though reauthorization of E-Verify was briefly in doubt, it appears now that congressional authorizers have agreed on a way forward, and that the program needs a lot more study.
A bill on the House floor today would extend E-Verify as a “voluntary” program for 5 years and require much more study of the system and its problems. The consensus at the beginning of the year was that Congress would require every employer in the country to use it by the end of the year.
Since then, flaws in the E-Verify database and tracking system have come to light and it has become more clear that “internal enforcement” of immigration law means tracking and databasing all Americans. My paper on the subject is called “Franz Kafka’s Solution to Illegal Immigration.”
E-Verify is losing its luster. In the reauthorization bill, Congress has tasked the Government Accountability Office with conducting two studies to explore problems with the system and the policy. One will look into the large number of erroneous “tentative nonconfirmations,” their causes, and potential remedies. DHS sought to glide past these issues in its advocacy for E-Verify this year. The other will look at how E-Verify would effect small businesses (and also small non-profits and municipalities). Current users of E-Verify tend to be large employers that are motivated (by threat of enforcement or past enforcements) to comply scrupulously with the law. The already low quality of the E-Verify system’s results will drop when other employers not so motivated begin to use it.
If E-Verify goes forward another five years, technical and programmatic problems will become more clear. But we shouldn’t take our eye off the ball. A national E-Verify system would be used to give the federal government direct regulatory control over law-abiding Americans. Federal authorities would use it to control not just work, but housing, financial services, health care, and access to alcohol, tobacco, and firearms — and these are just the obvious things.
Filed under: Cato Publications; Immigration and Labor Markets; Law and Civil Liberties; Telecom, Internet & Information Policy
Pots, Kettles, and Sen. Brownback
Via Yglesias, Sam Brownback is outraged that the Chinese government would spy on foreigners on its soil without a warrant. When it was pointed out to him that the United States government is now authorized to conduct warrantless spying in the United States, he had this to say:
We don’t put the hardware and software on hotels. If there is a targeted individual that seems to be a likely prospect of terrorists, they must go through the FISA court and ask for a court to determine that there is probable cause to be able to listen in on that information.
This is a blanket requirement of a hotel to operate a license in China. It is non-specific to anybody. It can be used on journalists. It can be used on athletes — or, excuse me, they’re at the Olympic village — but on their families. It can be used on democracy advocates, human rights advocates, none of which is prohibited. It is real time.
I think there is a huge difference between these two that are taking place.
Well, except there isn’t. All that’s required under the FISA Amendments that the Senate passed a couple of weeks ago is that the government “certify” that the “target” of the surveillance is located overseas. There’s no requirement that the government identify specific targets, and there’s no “probable cause” requirement at all — not even the permissive “agent of a foreign power” standard that had previously governed FISA intercepts.
This means that if the Olympics were held in the United States, the US government could “target,” say, a foreign newspaper such as the Guardian. And as a means of “targeting” the Guardian, it could tap the hotel rooms of all Guardian reporters in the United States.
Now, under the FISA Amendments Act, the government would have to submit a “certification” to a judge describing the eavesdropping plan. And the judge is required to verify that the interceptions are not “targeting” persons located within the United States. But, the government could argue with some plausibility, the “target” of the acquisition is the Guardian, which is located overseas, not the particular reporters who are in the United States. It would be a close legal question. And anyway, the government “is not required to identify the specific facilities, places, premises, or property” in the certification it submits to the judge, so the judge might not even realize that the government is bugging every reporter.
Worst of all, even if the judge rejected the “certification,” the government would have 30 days to continue eavesdropping before it was required to comply with a judge’s order. Since the Olympics are only about 3 weeks long, that means the government could intercept every single call from every single foreign reporter throughout the entire Olympics regardless of what the judge nominally overseeing the eavesdropping said.
Finally, lest we think the United States government would never do such a thing, the FBI repeatedly spied on “democracy advocates” and “human rights advocates” during the Cold War. For example, between 1954 and 1973, the FBI’s New York office alone conducted 433 break-ins of organizations J. Edgar Hoover didn’t like. Targets included the National Lawyers Guild, the Chicago Committee to Defend the Bill of Rights, the American Youth Congress, Vietnam Veterans against the War, Students for a Democratic Society, the Student Non-Violent Coordinating Committee, the Joint Anti-Fascist Refugee Committee, the League of American Writers, the National Mobilization to End the War in Vietnam, the Jewish Cultural Society, the Civil Rights Congress, and dozens of other organizations. And we only know about those break-ins because the head of the FBI field office failed to destroy his records as he had been ordered to do by Hoover. The records of other field offices were destroyed, but there is every reason to think that a similar number of organizations were spied upon in other cities.
Now, I have no evidence that anything of the sort is going on today. But this is precisely why there needs to be judicial supervision of eavesdropping efforts. Because we know from history that without external oversight, power will inevitably be abused. And unfortunately, Sen. Brownback voted for legislation that significantly reduced judicial oversight of wiretapping activities. Brownback is absolutely right to say that domestic eavesdropping shouldn’t occur until the government has demonstrated probable cause to a judge. Too bad he didn’t vote that way.
All Pretenses Abandoned
Welfare enthusiasts have always used pushes for free trade as leverage for increased support for laid-off workers. The logic was that because free trade brings myriad benefits to society, society could give just a little spare change to those who no longer can shelter behind consumer-funded protectionist walls.
That is not exactly a principled position, of course (as I have asserted here before) but a new, ”improved” proposal this time appears to have the support of business groups. They have been convinced that the possible backlash against globalization is worth a massive expansion of the welfare state, and are backing a new wage insurance scheme that would cost $22 billion, funded through payroll (i.e., employment) taxes.
But wait, there’s more. The new program would be available for all displaced workers, not solely for those who lost their jobs because of import competition. While I have always resisted that distinction because it demonized trade unfairly (see here), a trade-linked scheme at least was less costly (less than $1 billion currently) and, up until recently, kept the trade ball rolling well enough.
In light of the collapse of the Doha round, the stalling of the bilateral trade agreement with Colombia, and increased protectionist sentiment at home and abroad, it is clear that negotiated trade liberalization efforts are in peril. What is not clear is whether an expansion of the welfare state would appease trade skeptics, including a certain front-running presidential candidate, and revive the decades long bipartisan support for trade. So what exactly are we buying here?
Filed under: International Economics and Development; Tax and Budget Policy; Trade
Indictment of Sen. Stevens - An Interesting Tidbit
I suppose the charges brought against Senator Ted Stevens (R-AK) aren’t terribly interesting to most libertarians. Perhaps we get a bit of schadenfreude as one of the mighty fall, but shady dealings that edge into outright corruption are part and parcel of politics.
You’re not going to see a lot of jaws dropping around the Cato Institute with the news of the Senator’s indictment. And (if I may venture to speak for my colleagues) few of us think that if you just “cleaned up” the process, it would actually work.
But here’s an interesting tidbit: The indefatigable David Carney of TechLawJournal has given some thought to why these particular charges were brought. His subscription newsletter has a summary of the case with a section called “DOJ Forum Shopping,” which says, in part:
The 6th Amendment of the Constitution provides that “In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed.”
Federal Rule of Criminal Procedure 18 provides that “Unless a statute or these rules permit otherwise, the government must prosecute an offense in a district where the offense was committed. The court must set the place of trial within the district with due regard for the convenience of the defendant and the witnesses, and the prompt administration of justice.”
Stevens’ house is in Alaska. The alleged home improvements, and all of the transactions alleged in the indictment, occurred in Alaska. Only the filing of the Senate Financial Disclosure Forms (SFDFs) are alleged to have taken place in District of Columbia. Thus, the §1001/SFDF offense is the only one that the DOJ can assert occurred in the District of Columbia.
Thus, the indictment alleges that Sen. Stevens violated §1001 “in the District of Columbia”.
If the DOJ were to charge Sen. Stevens with bribery or tax evasion, then there would be no credible argument that the alleged crime occurred in the District of Columbia, and Sen. Stevens would be entitled to have the case moved to Alaska.
Carney does an extensive analysis of factors that would cause the Justice Department to want to keep the case out of Alaska, and he reports on the evasiveness of a DoJ official when queried why tax charges weren’t brought, which would place the case to the Senator’s home state.
Interesting stuff from a smart lawyer and reporter. Most political coverage is about the “horse race.” David Carney law and technology coverage reveals the chess match.
(And he’s ethical: Carney discloses that he is an ex-Alaskan who voted for Sen. Stevens in the 1984 Senate election. I’ll do the same: I worked for Senator Stevens on the staff of the Senate Committee on Governmental Affairs for a short time in, I believe, 1996.)
No Resort Left Behind
A few years ago I wrote a paper trying to itemize where federal education dollars go. Unfortunately, no one keeps comprehensive data on uses like this. Apparently, you just can’t analyze student performance without “four-and-a-half acres of indoor gardens and winding waterways….a 25,000-square-foot day spa and fitness center” and “the energy of Glass Cactus nightclub.”
Must You Smear?
Over at Flypaper, Liam Julian has started a Quick and the Ed Watch, a quest to expose every bit of hyperbole that comes out of the blog belonging to the think tank Education Sector. Well, we at Cato have had our own share of run-ins with those fine folks, and Kevin Carey’s response to my current Cato Policy Report cover story shows why.
Carey has chosen to use my piece as the latest exhibit in his case to prove that there’s a “libertarian conspiracy to destroy public education,” and he writes with the tone of a man convinced he’s got me and the conspiracy on our way to death row:
there really are people out there who simply want to dismantle the entire enterprise….People like Neil [sic] McCluskey…who recently published a new policy brief explaining why public education is intrinsically un-American. Again, that’s not bloggerly snark, it’s the actual thesis: McCluskey believes that public education is a “fundamentally flawed–and un-American–institution” and a later subhead describes “Public Schooling’s Un-American Ideals.”
Maybe I should blame myself for this. I did write that public schooling is a “fundamentally flawed—and un-American—institution.” Of course, Carey asserts that I said public education is the problem. Apparently, I didn’t make a clear enough distinction between the two. So when I wrote, for instance, that we should “end public schooling and return to public education….Ensure that the poor can access education, but let parents decide how and where their children will be educated,” I was obviously being too verbose. Who could read that and know that I’m against government-dominated, take-what-we-give-you public schooling, while I favor empowering all parents to themselves pursue good education for their children? And why does Carey fail to address any of the substance of what I wrote, like data showing that early-American education worked for broad swaths of people, or quotes demonstrating that social control has been the aim of many public-schooling advocates? I guess I should have written something much shorter, or done a YouTube video, or written a Haiku, or something.
Actually, I’m starting to think this isn’t my fault at all. The problem is that Carey is trying to do what far too many public-schooling defenders resort to when presented with reasoned critiques of their favorite institution: smear the messenger, and try to keep the substance of the message from seeing even the slightest light of day.
Sadly, Carey’s blatant disregard for the distinction I drew between public schooling and public education, and even his failure to consider any of my major points or evidence, isn’t what ends up taking the sorry cake. The lowest point is his effort to equate opposing government-dominated schooling with supporting propertied-class privilege, disenfranchised women, and all sorts of other inequalities that Carey knows weren’t the products of a free education system, but rather legally—read: government—imposed constrictions. And I might add that public schooling systems segregated African-Americans well into the 20th Century and treated lots of minority groups as second-class citizens. I would never use this, though, to blow off defenders of public schooling as somehow being neo-segregationists. That’s just not how we in “the libertarian conspiracy to destroy public education” roll.
The Still-Frozen Dohapsicle Round
After nine days of trying to reanimate the cryogenically preserved Doha Round, negotiators are calling it quits again.
I have sympathy for the well-intentioned, hard-working members of those trade delegations who hoped to finally nail down the structure of a Doha Round agreement in Geneva this week. Unfortunately for them, their counterparts included too many pretenders who were more interested in using the stage provided by the negotiations to make political statements for the crowds back home.
The fact that after several days of progress the talks broke down over failure to bridge gaps on what should have been a small caveat provision proves that the political costs of a successful outcome overshadowed the political benefits for some countries.
But there are some silver linings. International trade flows continue to grow faster than the global economy, which has been moving forward at a decent clip this decade. Cross-border investment, too, continues to increase. All of those trends have been facilitated by reforms undertaken unilaterally by countries around the world. And there is every reason to believe that those trends will continue, and perhaps even accelerate while Doha sleeps.
Filed under: International Economics and Development; Trade
Sounds Familiar?
“[The speaker] urged the students to study in order to serve the people and those in need, and not to fill their pockets,” reported the media.
Sound familiar? No, it wasn’t Barack Obama urging students to pursue “collective service” instead of chasing after a “big house and nice suits,” but Aleida Guevara, the daughter of the infamous Che Guevara, talking to Paraguayan students yesterday.
Guevara went on to say that “Each of us isn’t worth anything. The processes belong to the people, and not to any individual man.”
That’s a good audition for the commencement address at Wesleyan University next year.
Filed under: General; Government and Politics; Political Philosophy
Evo Morales’ Candid Disregard for the Law
“When some lawyer tells me ‘Evo, you’re making a judicial mistake; what you’re doing is illegal,’ well, I keep going even though it’s illegal. I then tell the lawyers: ‘If it’s illegal, go ahead and make it legal. That’s what you went to school for.’”
- Evo Morales, president of Bolivia, candidly admitting to violating the law while promoting a socialist revolution in his country [In Spanish]
Filed under: General; International Economics and Development
Another Episode of “Great Moments in Local Government”
Faithful readers of this blog may recall my three-part series (here, here, and here) about the hassle of re-registering a car in the wonderful Commonwealth of Virginia. As you can imagine, that was a libertarian-reaffirming experience. But just in case you were wondering whether the effect was wearing off and I was about to be co-opted by the forces of statism, you can put your mind at ease. I recently had the pleasure of being called for jury duty by Fairfax County.
I have to confess that the jury summons did not cause immediate anguish. I had never served on a jury, or even been part of a jury-selection process, so I was a tad bit curious (I did receive a summons at my work address many years ago from the D.C. government, but since I lived in Virginia - and had never lived in DC - I tossed it in the trash). Maybe I would be selected for a case involving a gun owner, a drug user, or a tax evader, and I could stop a harmless person from being convicted. So I showed up at the Fairfax County Courthouse last week at the announced time of 8:15.
The first thing I noticed - much to my dismay - was that the rent-a-cops at the entrance were confiscating cell phones and blackberries. This would have been a tragedy since I’m addicted to the blackberry and I was planning on filling any dead time with emails, text messages, and Internet browsing. Fortunately, it turned out that they were only seizing devices with cameras, leaving me grateful (for once) that the tight-fisted Cato managers provided me with the oldest and cheapest version on the market.
Having avoided the near-death experience of being without a blackberry, I wander to the jury-assembly room. This is where the day begins to head downhill. The bureaucrats cheerfully thank us for being there and announce that we will be shown a video at 8:45. I’m tempted to ask why we had to show up at 8:15 if things didn’t begin ’til 8:45, but I bite my tongue. After all, a court system is one of the few legitimate functions of government, so I didn’t want to rock the boat.
Thirty minutes later, it’s finally time for the video. Some of my colleagues give me grief about my mini-documentaries, but they would be tempted to award me an Oscar if they had to watch the syrupy being-a-juror-is-a-wonderful-civic-experience video that I had to endure. But at least it didn’t last too long and there was no offensive pro-government propoganda. Afterwards, the court bureaucrats ask if we have any questions and then tell us that we will get paid $30 per day for our trouble. We’re also told that we could request a form if we wanted to reject the money and instead have it funneled into some sort of Justice Trust Fund. My faith in my fellow citizens was bolstered when only about five percent of the crowd raised their hands and asked for the form.
At this point, we’re then told that someone may call our names at 10:00 to go to a courtroom for potential jury selection. Since it’s not much past 9:00, I’m once again tempted to ask why we had to show up at 8:15, only this time the voice in my head in phrasing the question in a slightly less polite fashion. Only the soothing presence of my blackberry prevents me from making a scene.
Shortly after 10:00, a group of jurors gets called, but I’m not one of them, but hopes of any early dismissal evaporate when my name is part of the second group. So about 30 of us dutifully march to a courtroom, only to then wait for another 20-plus minutes. We eventually get seated, at which point 12 of us (but not me) are called to the jury box and asked questions about impartiality and whether there are any conflicts that would prevent being on the jury.
This is where it got interesting, at least from a libertarian perspective. The court was hearing a civil case involving a contract dispute, and the judge explained (if I understood correctly, which may not have been the case at that uncivilized hour of the day) that the law did not necessarily seek to enforce and uphold contracts. Instead, the goal was to find a utilitarian, cost-minimizing way of settling the dispute. In other words, if the cost of forcing the fulfillment of the original contract was greater than the damage to the wronged party, then somehow jurors were supposed to let that guide their decisions. The potential jurors were asked to raise their hands if they had a problem with the notion that they were supposed to apply the law as determined by the state legislature, not to decide based on their own view of right and wrong.
At this stage, I knew I would not be a juror. Even if all 12 jurors had excuses and could not serve, I would be rejected the moment that the judge asked me to raise my hand if I would be guided by something beyond the capricious choices of the Virginia state legislature. While twiddling my thumbs in the back of the courtroom, I began envisioning the Patrick Henry-style speech I woud give when the judge asked why I would have a problem. In a very anti-climactic development, though, a jury was seated without additional names being called. Then, this morning, my group was not called, so my Walter Mitty fantasy of starting a judicial revolution with a stunning oration will have to wait at least three more years.
Obama, McCain, and Health Care
In the face of widespread public demand for changes in the U.S. health care system, both Barack Obama and John McCain have offered detailed proposals for reform. In the new study, ”A Fork in the Road: Obama, McCain, and Health Care,” Cato scholar Michael D. Tanner examines the candidates’ plans, and concludes that, while Senator McCain’s proposal is far from perfect, from a free-market perspective, it appears superior to Senator Obama’s plan.
Filed under: Government and Politics; Health, Welfare & Entitlements
Reauthorization Of E-Verify In Doubt
Had you asked anyone knowledgeable in the area a year ago, they would have told you that Congress was going to make “E-Verify,” the federal government’s immigration background check system, mandatory for all employers by the end of 2008.
Well, a headline in National Journal’s Congress Daily yesterday tells quite a different story (paylink): “Reauthorization Of E-Verify Immigration Program In Doubt.”
“House lawmakers and aides are locked in an impasse over legislation that would renew a program employers can use to verify the legal status of their workers,” the story says, “mainly over language that some worry might ultimately kill this means of enforcing immigration laws.”
E-Verify has gone from “greased” to “on-the-chopping-block” in just one short year.
Irony of ironies, it’s the bureaucracy that may kill it. The main holdup is a dispute over how the system would be paid for. The Department of Homeland Security has apparently been sticking the Social Security Administration with the bill for operating the system, and Social Security hasn’t got any spare funds.
This brings together threads from a couple recent posts of mine on E-Verify. I wrote in April about the inability of the Social Security Administration to provide the services it is currently called on to perform. New responsibilities placed on SSA wouldn’t just magically get done.
From a representative of a Social Security workers’ union, I had learned the following about what people could expect when they went to straighten out their E-Verify paperwork with SSA:
What would the process be like? Well, try calling your local SSA field office to find out. The SSA worker rep reported that 50% of those calls aren’t answered because field offices are too busy. Calls to the SSA’s national 800-number don’t go through 25% of the time. It’s not just a phone problem. The agency currently has a backlog of 752,000 on disability rulings. That’s three quarters of a million people who aren’t getting an answer from SSA. It takes 530 days – a little under a year and a half – to get a disability ruling out of SSA.
And I speculated the other day that Stewart Baker’s recent rant against the Society for Human Resource Management might be motivated by bureaucratic jealousy. Now we see that there’s plenty of it to go around. E-Verify isn’t important enough to get federal agencies to play well together.
In truth, I don’t think E-Verify will go under because of this dust-up, but I don’t think it’s going to be the mandatory, nationwide program so many thought either. (I described many ills of such a policy in my paper, “Franz Kafka’s Solution to Illegal Immigration.”)
There are lessons here for Republicans (and some conservatives) who dreamed that they would solve illegal immigration with a big, national, background-checking enforcement system: Bureaucrats own the bureaucracy. You do what they let you do; they do not do what you think they should do. You can’t turn big government to your ends. It only works for its own ends.
Filed under: Cato Publications; Immigration and Labor Markets; Law and Civil Liberties; Telecom, Internet & Information Policy
Another Potential Winner of the “Strange New Respect” Award
Advocates of limited government often joke (otherwise we would cry) that Republicans are the Stupid Party and Democrats are the Evil Party (this is why taxpayers should hide their wallets the moment there’s talk of “bipartisanship,” but I digress).
One of the reasons that the GOP is the Stupid Party is that Republicans generally are easy to manipulate. Most people understand that their enemies don’t want them to succeed. As such, they are — at the very least — skeptical about any advice coming from their opponents (as a Georgia Bulldog, for instance, I wish the coaches of the Florida Gators took suggestions from the Bulldog coaches, but I digress again). Republicans, however, are a tad bit gullible. When statists give them a few kind words and a pat on the head for supporting schemes to expand the burden of government, some Republicans genuinely think that they have a new set of best friends and they become even more likely to surrender to the left. This is so commonplace in D.C. that there’s an unofficial “Strange New Respect” Award, which is given to Republicans who get seduced by those who want to make government bigger and/or to exterminate the GOP.
Treasury Secretary Hank Paulson may be the next winner of this dubious prize. The New York Times business section has a big article featuring lots of praise for Mr. Paulson from some of the most collectivist politicians in Washington:
Mr. Paulson…has won praise on Wall Street and Capitol Hill, particularly among Democrats, for his role in fashioning solutions to economic difficulties this year. “He has handled this crisis extremely well,” said Representative Barney Frank, the acerbic Massachusetts Democrat who is chairman of the House Financial Services Committee and customarily a scathing critic of the Bush administration. “It’s fair to say that he and almost everybody else failed to anticipate some of these problems. We all underestimated it. What I give him credit for is how rapidly he adapted.” …this month, as Mr. Paulson helped hammer out emergency legislation authorizing the federal government to potentially inject hundreds of billions of dollars into Fannie and Freddie if the government-sponsored mortgage makers weaken further, he spent long hours with lawmakers of both parties. …The House speaker, Nancy Pelosi, a California Democrat and a critic of the White House, praised Mr. Paulson for changing Mr. Bush’s mind. Senator Christopher J. Dodd, the Connecticut Democrat who is chairman of the Senate banking committee, is also singing “Kumbaya.” “I’ve watched him grow in the last year, not in terms of intellectual capacity but in his appreciation of how this town works,” says Mr. Dodd.
In the business world, Secretary Paulson never would have taken advice from his competitors on how to land a big client or secure a major deal. Hopefully he will apply the same smarts to the political world and realize that flowery words from the left are a sign that he’s on the wrong path.
Filed under: General; Government and Politics; Tax and Budget Policy
“Reforming Fourth Amendment Privacy Doctrine”
Frankly, I don’t expect the scholars, lawyers, and judges who have been steeping in traditional Fourth Amendment doctrine their entire careers to get the thesis of my recent American University Law Review article. But you can! And, eventually, if I do enough work, they will.
Here are some highlights from the introduction to “Reforming Fourth Amendment Privacy Doctrine“:
Since 1967, the Supreme Court and lower courts have relied too heavily on an unreliable test that arose from the leading Fourth Amendment case, Katz v. United States. Distracted by Justice Harlan’s concurrence in the case and befuddled by the concept of “privacy,” courts have ignored the simple rule of the actual holding in Katz and conditioned Fourth Amendment rights on surmises about privacy “expectations.”
Privacy is a real thing that need not be a matter of conjecture. The Katz Court held that personal information was protected by the Fourth Amendment because, as a factual matter, the defendant had kept it private. Installing a wiretap to overcome Katz’s use of law and physics to conceal information was unreasonable without a warrant. The Court did not base its holding on open-ended “expectations” or “reasonableness,” as Justice Harlan’s concurrence suggested, but on the affirmative steps Katz took to conceal that information.
. . .
If an individual has secured the privacy of particular information, the Fourth Amendment focuses on the reasonableness of the government’s actions in undoing that privacy, not on the reasonableness of the individual’s expectations.
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