Archive for May, 2009
Iraq’s Refugee Crisis
George W. Bush’s misguided attack on Iraq has had catastrophic consequences for the Iraqi people. Although the removal of Saddam Hussein was a blessing, the bloody chaos that resulted was not. Estimates of the number of dead in the ensuing strife starts at about 100,000 and rises rapidly. The number of injured is far greater.
Moreover, roughly four million people, about one-sixth of the population, have been driven from their homes. The most vulnerable tended to be Iraq’s Christian community and Iraqis who aided U.S. personnel — acting as translators, for instance. Yet the Bush administration resisted allowing any of these desperate people to come to America, since to resettle refugees would be to acknowledge that administration policy had failed to result in the promised paradise in Babylon.
This horrid neglect continues. Reports Hanna Ingber Win:
Of the millions displaced, the United States will resettle about 17,000 new Iraqis this coming fiscal year. While that is a relatively small number of arrivals compared to the number displaced, about a third of them will end up in El Cajon and Greater San Diego. More than 5,000 new Iraqis will arrive in San Diego County during the fiscal year ending September 30, 2009, according to Catholic Charities in the San Diego Diocese. Getting jobs, homes and visas to reunite the families of the new arrivals — many of whom put their lives and their families’ lives at risk by helping the U.S. military — is a monumental task.
As the Iraq War played out, the Bush administration seemed to do everything in its power to ignore the refugee crisis. Former President Bush, reluctant to admit to a failed war policy, never mentioned the plight of the refugees and for years refused to allow Iraqis fleeing the war zone to resettle in the U.S. Only after significant political pressure from members of Congress and advocacy groups did the administration’s policy begin to change, and refugees began gaining access to the United States.
As a presidential candidate, Barack Obama pledged to address the humanitarian crisis caused by the war. He vowed to increase the amount of aid given to countries like Syria and Jordan, which harbor most of the displaced people, as well as expedite the process of resettling refugees here.
“The Bush administration made every effort they could to try to minimize the issue [of Iraqi refugees] in the debate on the war,” Amelia Templeton, a refugee-policy analyst with Human Rights First, says not long after the presidential election. The Obama administration, on the other hand, she says, has made the issue an explicit policy priority. “Obama has said this is a major problem, that we are responsible for this problem and we will try to change this.”
Whether the Obama administration will live up to its rhetoric is still to be seen.
Immigration is an emotional issue at any time. But there is no excuse for not accepting more persecuted peoples who are fleeing violence sparked by U.S. military action and attacks sparked by their aid for U.S. military forces. If America refuses to act as a haven for these people, then yet another light will have gone out in what was once a shining city on a hill for the world.
Gingrich, Fear-Mongering, Failed Leadership
There’s a reason why Newt Gingrich is on the political sidelines, and there’s a reason why Vice President Dick Cheney does not have a Republican successor to carry on his preferred policies. On Sunday’s Meet the Press, the contrasts in terrorism and national security policy between President Obama and these leading Republicans were in high relief.
After discussing the personal investment in aggressive counterterrorism Dick Cheney and others in the Bush White House had after the “shock” of 9/11, Newt Gingrich said:
Let me just say, I think people should be afraid. I think the lesson of 1993 — the first time they bombed the World Trade Center — was: Fear is probably appropriate. I think the lesson of Khobar Towers — where American service men were killed in Saudi Arabia — was: Fear is probably appropriate. I think the lesson of the two embassy bombings in East Africa was: Fear is probably appropriate. I think the lesson of the Cole being bombed in Yemen was: Fear is probably appropriate.
I’ll tell you, if you aren’t a little bit afraid after 9/11 and 3,100 Americans killed inside the United States by an effort. If you aren’t worried about the second-wave attack that was designed to take out the biggest building in Los Angeles, I think that you are out of touch with reality.
Host David Gregory asked:
But, Speaker Gingrich, you make the point about how Vice President Cheney felt — personally, personal fear. And isn’t President Obama’s argument that fear as a basis of national security policy is not sustainable over time? How do you come up with a sustainable legal framework, a sustainable national security policy? Don’t we elect leaders to transcend fear for lasting policy?
Gingrich’s response was to cite the sustained American effort in the Cold War. There was, of course, background fear of nuclear war and communism during that time, but the policy that got us through the Cold War was the pragmatic and rational policy of containment — a far cry from policymaking based in fear.
For the time being, Republicans appear to be “on tilt” about terrorism, and seeking their footing in the politics of panic.
Wal-Mart: Health Food Store?
As someone who believes in liberty, my natural inclination is to defend a company like Wal-Mart from the usual attacks. You know, the company should pay its employees more (sure, just like all other companies, including libertarian think tanks!). Wal-Mart destroys local businesses (that is, enterprises which offer fewer choices but at higher prices, and whose customers cheerfully flee when given an alternative). The people most likely to attack Wal-Mart are those who would never shop there and don’t know anyone who does shop there.
It’s always nice to find evidence to back my inclinations. It turns out that Wal-Mart not only lowers prices for poor people, but improves their health. Reporting on this improbable result is Radley Balko, formerly at Cato and now at Reason:
In the popular imagination, a big-box store such as Wal-Mart is more often seen as part of the problem than part of the solution: We associate Wal-Mart with large women in stretch pants, fat kids sucking down tubs of soda, and morbidly obese men inching down the snack-food aisle in motorized shopping carts. The store makes candy, chips, and soda ridiculously cheap—so wouldn’t Wal-Mart contribute to the obesity problem?
That’s what economists Art Carden of Rhodes College and Charles Courtemanche of the University of North Carolina at Greensboro suspected. So they conducted a study to find out. Carden and Courtemanche have done a number of studies on Wal-Mart. Carden insists they get no funding from the company, directly or indirectly. Rather, he says, the two free-market economists have been intrigued by the Wal-Mart debate and wanted to test some of the more common criticisms of the store. Generally, they’ve found that the worst fears about Wal-Mart are unfounded, and that the stores have a mostly positive impact on their communities.
But they thought this one might be different. “We expected the study to show an increase in obesity in communities with a Wal-Mart,” Carden says. “We know that Wal-Mart lowers the cost of food, but we figured it’s not always the best food for you.”
To their surprise, they found the opposite—there was a small but statistically significant reduction in obesity rates in communities with a Wal-Mart, perhaps because the store also sells fresh produce of good quality at a good price.
Broadening the study to big-box stores in general, the effect was even more pronounced. “People actually bought more produce, more fruits and vegetables,” Carden says. “Instead of just eating more, they ate a higher-quality diet—a lower-fat diet than the rest of the population.”
It appears that people aren’t as stupid as paternalistic politicians believe. And markets ain’t half bad either.
More Politicization of the Department of Justice
At the last election, Democrats complained mightily of George Bush’s having politicized the Department of Justice: firing prosecutors, suborning legal memos justifying an expansion of executive power, etc., etc. Well, it now seems at best that the pot was calling the kettle an abuser of power.
Early in the administration, when the DC Voting Rights Act last made the news cycle, it came out that newly confirmed AG Eric Holder sought a second opinion from the acting solicitor general when the Office of Legal Counsel affirmed its 45-year position that giving DC residents representation in Congress could not be done without amending the Constitution. The bill is now stuck because of an amendment that was added to it relaxing the District’s strict — even after Heller — gun regulations, but this issue will resurface.
Now, in the most recent development in the “Is Hillary Clinton Constitutional?” saga the OLC reversed its own position from 1987 just in time for federal prosecutors to file a motion to dismiss a lawsuit challenging Clinton’s appointment that cites the new memo (see footnote 21). Indeed, the motion was filed the same day Acting Assistant Attorney General David Barron — who had previously rebuffed Holder on the DC Voting Rights Act (though we still have to see what the next confirmed OLC head says, be that Dawn Johnsen or someone else) – signed the new OLC memo.
The issue is that Clinton’s appointment to the cabinet — as well as that of Interior Secretary Ken Salazar – violates the Emoluments (sometimes called Ineligibility) Clause of Article I, section 6 because both she and Salazar were sitting Senators when cabinet salaries were increased. Congress later passed short laws reversing these raises for the duration of both officials’ tenures but, as I’ve argued previously – and as OLC head Chuck Cooper spelled out in the 1987 memo – there is no “net accounting” proviso which somehow erases the constitutional defect. While the new memo relies heavily on historical practice – several presidents going back to William Howard Taft (most recently Bill Clinton in appointing Lloyd Bentsen to be Treasury Secretary) have proceeded in this manner — the fact that political branches have acted in a certain way doesn’t speak to the constitutionality of that action.
In short, again the Obama Justice Department has found a politically expedient way of dealing with pesky constitutional issues. In this case, that way involved issuing a memo to buttress a motion being filed that very same day in federal court.
H/T: Tom Fitton of Judicial Watch, which is involved in the suit challenging Clinton’s appointment.
A British Warning on Health Care
Briton Daniel Hannan, a member of the European Parliament, gained international noteriety when he challenged Prime Minister Gordon Brown after the latter spoke to the European Parliament. Hannan also has been warning Americans not to follow Britain in socializing its health care system.
Obama’s Proposed IRS Rules Mean Trouble for Overseas Americans, Will Also Lead to Less Investment in America
The U.K.’s Daily Telegraph reports that British banks may turn away any America clients as a result of an Administration proposal to modify the already-onerous Qualified Intermediary rules and make them even worse. This makes life more difficult for overseas Americans, which will compromise the competitiveness of U.S. firms trying to win market share around the world. It also will discourage foreign financial institutions from investing in America since pulling out of the U.S. market is an easy way to get out from under the IRS’s unfair extraterritorial regulatory reach.
British banks and stockbrokers may refuse to take on American clients if new international tax proposals outlined by President Obama are passed. The decision, which would make it hard for Americans in London to open bank accounts and trade shares, is being discussed by executives at Britain’s banks and brokers who say it could become too expensive to service American clients. The proposals, which were unveiled as part of the president’s first budget, are designed to clamp-down on American tax evaders abroad. However bank bosses say they are being asked to take on the task of collecting American taxes at a cost and legal liability that are inexpedient. …One executive at a top UK bank who didn’t want to be named for fear of angering the IRS said: “It’s just about manageable under the current system – and that’s because we’re big. The danger to us is suddenly being hauled over the coals by the IRS for a client that hasn’t paid proper taxes. The audit costs will soar. We’ll have to pay it but I know plenty of smaller players won’t.” The British Bankers Association (BBA) and APCIMS had a meeting with European counterparts 10 days ago to discuss the crisis. A delegation is set to meet the US Treasury’s Internal Revenue Service on 16th June to demand they drop the reforms. …President Obama’s proposals are built on the so-called Qualified Intermediary system which was intended to ensure Americans paid the correct tax wherever they were domiciled. Foreign financial institutions that handle American money have to fill in a US tax form on behalf of the client that has to be audited too.
Washington Likes Democracy — When People Vote Right
The U.S. government is a big proponent of democracy — as long as foreign peoples do what they are told. Washington pushed for early elections in Gaza and the result was … oops! A victory for Hamas. So now Washington doesn’t like democracy and won’t talk to the victors of a democratic vote.
Now the pattern risks repeating itself. Vice President Joe Biden recently visited Lebanon and told the Lebanese how much America likes democracy — as long as they vote for the parties that the Obama administration prefers. Reports Associated Press:
Vice President Joe Biden said Friday that future U.S. aid to Lebanon depends on the outcome of upcoming elections, a warning aimed at Iranian-backed Hezbollah as it tries to oust the pro-Western faction that dominates government.
Confident its alliance will win, Hezbollah criticized Biden’s visit as a U.S. attempt to influence the June 7 vote and held a mass rally to show its popular support.
Biden is the highest-level U.S. official to visit Lebanon in more than 25 years and the attention shows American concern that the vote could shift power firmly into the hands of Hezbollah. U.S. officials have said before they will review aid to Lebanon depending on the composition of the next government, apparently meaning military aid.
“The election of leaders committed to the rule of law and economic reform opens the door to lasting growth and prosperity as it will here in Lebanon,” Biden said. The U.S. “will evaluate the shape of our assistance programs based on the composition of the new government and the policies it advocates.”
The U.S. considers Hezbollah a terrorist group and Biden’s one-day visit was clearly timed to bolster the Western-leaning faction led by Prime Minister Fuad Saniora ahead of the vote. He expressed strong support for the government.
Foreign Aid Establishment Runs Scared
For years the foreign aid establishment has simply pointed at pictures of starving children abroad and said: give. Congresses and presidents have responded by tossing billions at the World Bank, International Monetary Fund, U.S. Agency for International Development, and other so-called aid agencies. The result, unfortunately, has been continuing poverty mixed with increased indebtedness. For good reason aid has been said to involve taking money from poor people in rich countries and giving it to rich people in poor countries. But the arguments against misnamed “foreign aid” advanced by Cato and other free market advocates have been largely ignored.
The latest challenger is Zambian economist Dambisa Moyo, who has gained significant public attention for her new book, Dead Aid. I’ve reviewed it in the Washington Times and Cato has hosted a forum for her. Dedicated to legendary British economist P.T. Bauer, the first recipient of Cato’s Milton Friedman Prize, Dead Aid excoriates the aid establishment for supporting policies that actually make recipients worse off. Foreign aid would be better called foreign hindrance.
Now, reports the Financial Times (full text hidden behind a subscription wall, alas):
A swell of opposition is building in the aid world to a new protagonist who has thrown down a strident challenge to the rock stars and liberal economists who have long dominated debate over foreign assistance to developing countries.
Galled by the ease with which Dambisa Moyo, a Zambian economist and former investment banker, has risen to prominence this year, activists are circulating detailed critiques of her ideas and mass mailing African non-government organisations to mobilise support against her.
Yet it is proving hard to suppress the hyper-active graduate of Oxford and Harvard, who pops up weekly in a new capital to promote her book, Dead Aid — the title itself an affront to rock star Bob Geldorf’s Live Aid campaigns.
Obviously the aid lobby is worried. Free market friends should jump in to back up Moyo. She has brought both attention and credibility to the case against foreign aid. This moment must not be wasted.
Neoconsensus
Since Rich Lowry, Karl Rove, and Charles Krauthammer have all admitted that Obama’s anti-terror policies are substantially the same as Bush’s, I assume they’ll refrain from arguing that Obama’s making the country less safe, and they’ll hold the recriminations if and when there’s another terrorist attack. Right?
A Correction
In a previous post, I offered my impressions on the Coburn-Burr-Ryan-Nunes health care reform bill, based on my reading of the bill summary prepared by their staff. The very next day, I had a friendly discussion with those staffers about the legislation. (They were most gracious; many thanks to them.) It turns out some of the things I wrote were inaccurate. So I’d like to make the following corrections.
Based on my reading of the bill summary and my discussions with staff, my previous post ought to have read that the Coburn et al. bill would:
- Mandate that Offer federal subsidies to states that create a new regulatory bureaucracy called a “State Health Insurance Exchange,”
- Mandate Require that all plans offered through those exchanges meet federal regulatory standards,
- Mandate Require “guaranteed issue” in those exchanges,
- Mandate Create “uniform and reliable measures by which to report quality and price information,”
- Impose price controls on those plans by prohibiting risk-rating,
- Launch a government takeover of the “insurance” part of health insurance, by means of a “risk-adjustment” program intended to cope with the problems created by price controls, and Require that states creating an exchange also create some mechanism for providing coverage to people with high-cost illnesses, including but not limited to risk-adjustment, risk pools, or reinsurance, and
- Fall just short of an individual mandate by setting up (mandating?) Require that states creating an exchange take steps to facilitate enrollment, which may include automatic enrollment in exchange plans at “places of employment, emergency rooms, the DMV, etc.” — essentially, trying to achieve universal coverage by nagging Americans their residents to death.
My description of the legislation as a “Mandate-Price-Control Bill”? Not accurate. My claim that the bill involves tax increases? Based on my erroneous impression that the bill would impose price controls on insurance premiums. The bill may lead to some tax increases (it proposes new categories of federal spending after all), but for the moment I take staff at their word that on net the bill would not increase taxes or government spending.
The Laffer Curve in Action
Tom Golisano, one of the richest men in New York, has decided to escape the state’s greedy politicians by moving to Florida. This is another example of why higher tax rates are so destructive. When people are tired of being fleeced, they can move their labor and/or capital. They can choose to be less productive. And they can hire lobbyists, lawyers, and accountants to find creative loopholes.
Writing for the New York Post, Mr. Golisano is very happy that his money no longer will be funding tax-and-spend politicians in Albany:
Politicians like to talk about incentives — for businesses to relocate, for example, or to get folks to buy local. After reviewing the new budget, I have identified the most compelling incentive of all: a major tax break immediately available to all New Yorkers. To be eligible, you need do only one thing: move out of New York state. Last week I spent 90 minutes doing a couple of simple things — registering to vote, changing my driver’s license, filling out a domicile certificate and signing a homestead certificate — in Florida. Combined with spending 184 days a year outside New York, these simple procedures will save me over $5 million in New York taxes annually.
One thing’s certain: That money won’t continue to fund Albany’s bloated bureaucracy, corrupt politicians and regular special-interest handouts. How did the state get to this point? By spending, spending and spending some more. New York’s budget was $72.7 billion in 1999. Ten years later it ballooned to $131.8 billion. Each year, on average, the budget has risen at an astounding 6 percent compounded annual rate — more than double inflation (2.8 percent).
…This problem didn’t begin with the current recession. New York faced a $6 billion shortfall before the economic downturn. However, in the face of economic turmoil, Gov. Paterson, Assembly Speaker Sheldon Silver and Senate Majority Leader Malcolm Smith looked to the unions and special interests, who answered with one voice: raise taxes. That was irresponsible — and may just prove to be counterproductive, since the top 1 percent of earners account for about 50 percent of state revenue and are the ones who can and will leave.
Among other hikes in taxes and fees, they raised the marginal tax rate on the most successful (and most mobile) New Yorkers to 8.97 percent, the second-highest rate in the nation. Bottom line? By domiciling in Florida, which has no personal-income tax, I will save $13,800 every day. That’s a pretty strong incentive. Like I said, I love New York. But I’m not going to pay any more for the waste, corruption and inefficiency that is New York state government.
Tax Bureaucrats Take the Fun out of Everything
The Daily Mail reports that a Romanian student who sold her virginity to the highest bidder as part of an online auction may wind up keeping less than half of her earnings thanks to Germany’s oppressive tax system:
Tax authorities in Germany are poised to claim 50 per cent of the money that a teenage student earned for ‘auctioning’ her virginity… Romanian-born Alina Percea, who is a student in Germany, was paid £8,800 in cash for a weekend of sex with the Italian businessman after she auctioned her virginity online. But tax officials in Berlin regard the 18-year-old’s act as ‘nothing more than prostitution’. Prostitution is legal in Germany — but it is heavily taxed. …It also emerged that, because Alina earned so much in such a short time, she may even be liable for a hefty VAT bill too. VAT in Germany works out to 19 per cent, meaning the sale of her virginity could land her with just over £3,000 in the end.
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