Archive for October, 2009
In Canada You Need Wait-List Insurance!
Governments love to promise benefits. But politicians prefer not to have to raise the funds necessary to provide the promised services. The result for nationalized medical systems is political rationing … and long waiting lists. The Mackinac Institute, located in Michigan, has produced a series of videos on Canadians speaking about how their system works. The British Columbia Automobile Association even developed medical access, or wait list, insurance, before abandoning the program under pressure.
Max Baucus’s Magic?
Max Baucus says every single Democratic senator will vote for all the taxes, all the private-sector mandates, all the inter-governmental mandates, all the Medicare spending cuts, and all the new private-insurance subsidies that he and Harry Reid are cobbling together. What’s left to discuss?
Baucus may know something I don’t. But here’s what I do know.
- To subsidize Paul, Democrats need to rob Peter. And Peter ain’t gonna like that, whether “Peter” is union members, small businesses, insurance companies, medical-device manufacturers, sick people, or the middle class broadly.
- Of course, the government already does a lot of Peter-robbing and Paul-paying in health care. Democrats could subsidize Paul #2 by cutting subsidies to Paul #1. But again, Paul #1 — whether “he” be seniors, doctors, hospitals, insurance companies, pharmaceutical manufacturers, medical-device manufacturers, home health agencies, skilled nursing facilities, etc. — ain’t gonna like that.
- Members of Congress, including Democratic senators, tend to listen to those Peters and Paul #1s.
- Democrats could try to rob future generations, but they (particularly President Obama) have painted themselves into a corner on that one by promising not to add to the deficit. And with regard to deficit spending, the public appears to be in no mood.
Heck, I’m sure that Baucus knows a lot of things I don’t know. But I doubt he knows any magical incantations that’ll make those challenges go away.
(Cross-posted at Politico‘s Health Care Arena.)
Even Lawyers Should Be Paid More for Good Performance
Another oral argument I attended this week was in the case of Perdue v. Kenny A., in which Cato filed a brief at the end of August. The issue is whether a court can ever increase the statutorily set fees attorneys receive from the government when they successfully bring civil rights challenges to state action.
In order to enforce civil rights guarantees, Congress had two choices: either expand the Department of Justice to cover all civil rights cases, or privatize the system and allow free market principles to encourage private attorneys to prosecute violations. Congress chose the latter, creating a system of market incentives to encourage private attorneys to enforce civil rights and hold elected representatives responsible for the waste of taxpayer dollars lost in the defense of legitimate civil rights violations and repayment of “reasonable” attorney fees.
Here a group of attorneys won an important case for foster children in Georgia, and the court awarded them $6 million in fees based on prevailing hourly rates — the “lodestar” method — and an additional $4.5 million enhancement for the exceptional quality of work and results achieved. At Georgia’s request, the U.S. Supreme Court decided to review the case and determine whether quality of work and results are appropriately considered components of a reasonable fee.
Cato, joining six other public interest legal organizations, filed an amicus brief supporting the attorneys. We argue that the enhancement in this case is necessary to preserve incentives in the privatized market. Not only does it encourage attorneys to pursue civil rights abuses, but it provides a powerful disincentive for governments to draw out litigation in the hope that attorneys will no longer be able to afford pursue it. In addition, quality of performance and attained results are rightly considered as part of the attorney fee calculus. The enhancement here helps to promote the free market of privatized civil rights prosecutions and encourages governments to resolve civil rights cases quickly.
Unfortunately, the Court didn’t seem to be convinced at oral argument that there was a problem with the way civil rights attorneys are compensated under the lodestar method. Chief Justice Roberts and Justice Scalia, in particular, were aggressive in questioning a very well prepared Paul Clement (the former solicitor general, with whom I had the privilege to work on a different case that will be argued next month). They expressed concern about how to evaluate the “exceptional results” needed to justify a fee enhancement. Clement said that the Court could leave this to the trial judges’ discretion,to which Justice Scalia replied: “You say discretion. I say randomness.”
Only Justice Sotomayor, who was again an active questioner, suggested a standard to guide judges, citing such factors as a discrepancy between the market in which the attorney practices and the market on which fees are based, as well as the attoney’s experience (for example, the justices frequently referred to a “brilliant” second-year associate who might be paid at a partner rate). But several justices, at least, would never agree to such a standard. Even Justice Breyer, typically friendly to civil rights claims, expressed skepticism over whether millions of taxpayer dollars should be paid to already well-compensated lawyers.
Still, while it would be strange for district judges to have the ability to reduce fee awards for various reasons (such as inferior performance, even if technically victorious) while not being able to increase them, that’s the result we’ll have if the Court rules as all indications now suggest.
Duncan Blows Off Constitution, Facts
It never ceases to amaze me how effortlessly federal “educators” blow off the Constitution. Amazing me today is none other than U.S. Secretary of Education Arne Duncan, who in an address to the National Association of State Boards of Education offered the following cavalier dismissal of the Supreme Law of the Land:
I’d like to talk to you today about the federal role in education policy. It’s often noted that the Constitution doesn’t mention education, and that the provision of education has always been a state and local responsibility.
Yet, it is also true that American leaders have always considered education to be an important priority. They’ve always believed that a strong and innovative education system is the foundation of our democracy and an investment in our economic future.
This national commitment to education predates even the ratification of the Constitution. In the Northwest Ordinance governing the sale of land in the Northwest Territories, the fledgling government required townships to reserve money for the construction of schools.
In the middle of the Civil War, President Lincoln signed the Morrill Act to create land grant colleges and universities. Today, those institutions are some of the best teaching and research institutions in the world…
Here you see a textbook example of how you can brush off the Constitution in just a few easy steps! First, you acknowledge (actually, this part is optional) that authority over education is nowhere among the federal government’s specifically enumerated powers. Next, you shamelessly imply that all the founders really wanted power over education to be in the Constitution. After that, you always mention the Northwest Ordinance, even though it had nothing to do with the Constitution. Finally, you laud blatantly unconstitutional things other people have done and — voila! — the Constitution disappears!
Of course, making a factually or logically sustainable argument that you are not violating the Constitution when you obviously are is not the real goal here. This is just the standard political kabuki dance, a necessary bit of deference-payment to those few rubes who might still think that the Constitution serves some legitimate purpose.
That said, don’t you expect more from our secretary of education? After all, he has undertaken the incredibly noble job of teaching all of our children. Don’t you expect complete honesty from him, and maybe even some respect for the Constitution that he has taken an oath to uphold?
Of course you don’t. Neither do I — not one bit.
U.S. Standing in the World
Well before Barack Obama was awarded the Nobel Peace Prize, Americans were speculating on whether his ascendancy to the highest office in the land would help to improve the United States’ tarnished reputation in the world.
The early indications were encouraging, but largely anecdotal. The Pew Research Center provided data from surveys taken in May and June, and found a mixed picture: attitudes toward the United States were most improved in Western Europe, East Asia, and Africa (Nigeria and Kenya), but barely changed in the several predominantly Muslim countries polled, including U.S. allies Turkey and Pakistan.
The more relevant question is whether we should care. International relations is not a popularity contest. In the classical formulation, nation-states pursue policies that they believe will advance their interests. Sometimes these policies backfire. Sometimes they fail. But, all other factors being equal, we should assume that policies are directed from within, and not much influenced by without.
A recent study published by the American Political Science Association makes a reasonably convincing case that Americans should care about U.S. “standing” not purely for the sake of feeling good about ourselves, but also because improved standing is likely to contribute to more effective foreign policy. “Diminished standing may make it harder for the United States to get things done in world politics,” the report explains. In this context, the report continues, we should “think of standing … as the foreign-policy equivalent of ‘political capital.’” If we have a stored reserve of such capital, we can deploy this to mobilize international support. At a minimum, this will convince other countries to go along with us; in ideal cases, we might obtain their active support.
The report was commissioned by the outgoing APSA president, Peter J. Katzenstein of Cornell University, and the task force was chaired by Jeffrey Legro of the University of Virginia, and included a number of eminent scholars. [The full report is available here, a shorter public version was made available here, and Katzenstein and Legro summarized the findings in a recent article at Foreign Policy.com.]
Is Michelle Obama Right about Teachers?
First Lady Michelle Obama wrote yesterday in US News and World Report that we face a teacher shortage. She laments that up to a third of current teachers could retire in the next four years. The solution, she says, is to embark on an aggressive and multifaceted teacher recruitment campaign.
But here’s an interesting thought: What if a million teachers really did retire in the next four years, and we only replaced half of them?
Catastrophe? Millions of kids without teachers? Nope. In fact, we’d still have a lower pupil/teacher ratio than we did in 1970. Back then, we had 2 million teachers for 45.5 million students. Today, we have 3.2 million teachers for not quite 50 million students.
For the past 40 years, we’ve added teachers a lot faster than we’ve added students. In fact, we’ve added other staff even faster. As a result, the total staff to student ratio has gone up by nearly 75% since 1970.
There are plenty of critical problems with American education, but a looming crisis in the size of the teaching workforce is not one of them.
Czech Support for Klaus at 65%
According to press reports, the most recent opinion poll shows that 65% of Czechs support President Václav Klaus’ refusal to sign the Lisbon Treaty that would take more power from national parliaments and give it to the unelected bureaucracy in Brussels.
Klaus, who has been at the pinnacle of Czech politics for the last 20 years (as minister of finance, prime minister, speaker of the house and now as president), has an unmatched understanding of the Czech people. Clearly, once again, he was able to discern the public mood better than others. That includes his successor as the leader of the center-right Civic Democratic Party (ODS), Mirek Topolanek, who once opposed the Lisbon Treaty but now supports it. It seems that the ODS is in a state of revolt against him and may unseat him at the ODS Party Congress in November.
Klaus will be much encouraged by the above poll. As a consequence, it is less likely that he will give way under pressure and sign the Lisbon Treaty anytime soon. If he can hold out until the likely British referendum on the Lisbon Treaty midway through 2010, he will likely be remembered as the man who put an end to the most ambitious attempt to create a centralized European super-state in modern history.
All That NAEP Tells Us Is Things Ain’t Good
Yesterday, another round of scores on the National Assessment of Educational Progress – the so-called “Nation’s Report Card” — came out. They revealed flattened 4th-grade math achivement between 2007 and 2009, and a two point (out of 500) increase in 8th grade.
So what do these bits of data portend? Ask the experts:
“The trend is flat; it’s a plateau. Scores are not going anywhere, at least nowhere important,” said Chester Finn, president of the Thomas B. Fordham Institute, according to the New York Times. “That means that eight years after enactment of No Child Left Behind, the problems it set out to solve are not being solved, and now we’re five years from the deadline and we’re still far, far from the goal.”
Next, former National Center for Education Statistics commissioner Mark Schneider concluded that “either the standards movement has played out, or the No Child law failed to build on its momentum. Whatever momentum we had, however, is gone.”
And then there’s Michigan State University professor William Schmidt, a leading national-standards proponent, who opined in the Baltimore Sun that “there is a hardly any change. There is hardly any difference. How could we as a nation let that happen?” His solution to the problem: National standards, of course.
So what do I think about all this? As a long-time critic of NCLB, I am glad to see people seizing on the latest results and declaring the law a failure. It helps to advance my goal of ending the greatest federal education intervention to date, and I think NCLB supporters kind of deserve these attacks on their law. They have repeatedly given NCLB credit for positive things the evidence couldn’t come close to supporting, and it’s nice to see them on the defensive after all their overreaching.
Thursday Links
- Don’t let the sticker price fool you: The Baucus bill would increase the deficit and cost more than $2 trillion over 10 years.
- There’s no getting around it. There will be cuts in Medicare.
- The Supreme Court hears Alvarez v. Smith, which will affect the constitutional property rights of many people around the country.
- Cato’s David Rittgers debates troop build up in Afghanistan.
Regulation and Competition among Mortgage Brokers
With the House Financial Services Committee moving forward with a bill to increase the regulation of our consumer credit markets, particularly our mortgage market, it is worth asking the question: what’s the best protection for consumers, regulation or competition?
Let’s take the example of mortgage brokers. They’ve often been targeted as one of the causes of the crisis. The story goes that they just made the loans and passed it along to the lenders and/or Wall Street and so, didn’t care about the quality of the loan.
The response of government, first at the state then the federal level, has been to subject mortgage brokers to increased oversight and licensing, with the intent to keep the “bad actors” out of the marketplace. How well did this all work out?
According to Professor Morris Kleiner and Minn Fed Economist Richard Todd, not exactly the way you’d want. What the economists found was that tighter regulation on who can become a mortgage broker is actually associated ”with higher broker earnings, fewer brokers, fewer subprime mortgages, higher foreclosure rates, and a greater percentage of high-interest-rate mortgages.”
It seems the barrier to entry created by these licensing requirements reduced competition in a manner that caused far more harm to consumer than any protections provided by increasing the “quality” of mortgage brokers.
PATRIOT Powers: Roving Wiretaps
Last week, I wrote a piece for Reason in which I took a close look at the USA PATRIOT Act’s “lone wolf” provision—set to expire at the end of the year, though almost certain to be renewed—and argued that it should be allowed to lapse. Originally, I’d planned to survey the whole array of authorities that are either sunsetting or candidates for reform, but ultimately decided it made more sense to give a thorough treatment to one than trying to squeeze an inevitably shallow gloss on four or five complex areas of law into the same space. But the Internets are infinite, so I’ve decided I’d turn the Reason piece into Part I of a continuing series on PATRIOT powers. In this edition: Section 206, roving wiretap authority.
The idea behind a roving wiretap should be familiar if you’ve ever watched The Wire, where dealers used disposable “burner” cell phones to evade police eavesdropping. A roving wiretap is used when a target is thought to be employing such measures to frustrate investigators, and allows the eavesdropper to quickly begin listening on whatever new phone line or Internet account his quarry may be using, without having to go back to a judge for a new warrant every time. Such authority has long existed for criminal investigations—that’s “Title III” wiretaps if you want to sound clever at cocktail parties—and pretty much everyone, including the staunchest civil liberties advocates, seems to agree that it also ought to be available for terror investigations under the Foreign Intelligence Surveillance Act. So what’s the problem here?
Drivers’ Licenses a De Facto Law Enforcement Database
. . . notes the ACLU’s Chris Calabrese in this story about the use of license photos to search for criminal suspects.
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