Archive for November, 2009
If At First You Don’t Succeed
Mexican sugar growers want “in” on the cozy little arrangement that domestic sugar growers have here in the United States. They have formed an alliance with the U.S sugar lobby to recommend that the U.S. and Mexican governments work to “avoid importing sugar from other countries to help boost the market between the neighbours” (full article here [$]).
This proposal is not new, of course, having previously been suggested to lawmakers’ during the 2008 farm bill debate (see here). The “recommendation” was rebuffed at that time, but these people are nothing if not tenacious.
In what surely must be a contender for the “Understatement of the Year” award, the article ends with this: ” Sweetener users and free trade advocates are likely to find the recommendations controversial”. Someone at CongressDaily has a sense of humor.
Way To Go (Almost All the Way), Jay!
This morning Washington Post education columnist — and terrific Cato forum panelist – Jay Mathews called for abolition of the office of the U.S. Secretary of Education! Why? Because it has proven itself worthless, that’s why:
The president, I suspect, thought that Duncan, the former chief of the Chicago public schools, could use all he had learned there to raise achievement for students across the country.
It sounds great, but it was the same thought that led previous presidents to appoint those previous fine education secretaries to their posts. How much good did that do? Test scores for elementary and middle school students have come up a bit in the last couple of decades, but not enough to get excited about. High school scores are still flat. If national education policy had made a big jump forward, I would say we should continue to fill this job, but that hasn’t happened either. I think the No Child Left Behind law, supported by both parties, was an improvement over previous federal policies, but it was only copying what several states had already done to make schools accountable and identify schools that needed extra help.
Other than the “fine” secretaries part and the (sorta) nice words for NCLB, that sounds like something we at Cato’s Center for Educational Freedom might have written. Bottom line: Washington doesn’t add any value to education, and at best just picks up on things states are already doing.
Unfortunately, after dropping the “ed sec must go” bombshell and furnishing ironclad evidence why the position is worthless, Mathews retreats from the obvious, ultimate implication of his argument: We should abolish the department the secretary leads!
The evidence screams this and, from a technical standpoint, you can’t keep a cabinet-level department and not have a secretary to head it. But in what smells a lot like a cop out, Mathews asserts that the department should stay (though in a smaller form). After all, someone has to be in charge of doling out all of the taxpayer cash that isn’t doing a damn bit of good:
Keep in mind I am NOT saying we should abolish the education department. That old Reagan campaign platform died a natural death long ago. We need the department to intelligently distribute federal money to the most promising schools in our cities and states. Cut back the number of people rumbling around that big building on Maryland Avenue—many of them are going crazy from boredom anyway—and put it under the control of a savvy civil service administrator who knows how to keep the checks and the useful data rolling out.
Too bad Mathews wasn’t willing to go all the way on this. But just for proposing that we put the position of U.S. Secretary of Education out to pasture, he deserves some hearty applause.
‘Letting the Sick Die on the Street’
Blogger Matt Yglesias has described my CNN op-ed on health care as follows:
Meanwhile, in Harvard economist and Cato Institute senior fellow Jeffrey Miron’s dystopia, if your parents wind up with no money through bad luck or poor decision-making and then you get sick you’ll just die on the street for lack of money.
Did I really say such an outrageous thing? Well, I did not use exactly those words (as Matt makes clear), but yes, that is the logical implication of my position.
And I stand by it. Here’s why.
First, my assessment is that even with no government health insurance, hardly anyone would die on the street for lack of health care. The poor would use their income transfers to buy some health care or insurance. The poor would receive private charity. And health care would be far less expensive due to elimination of the distortions caused by government health insurance.
Second, my position is that government provision of health insurance is enormously inefficient: it means worse health care for everyone, and it wastes resources that can be put to other uses. So the negative of having a few people suffer without government health insurance must be balanced against the good of having better medical care for all and against the good that can be accomplished with those saved resources.
That good might be lower taxes for everyone, or more government spending on education, or greater public health spending to combat HIV in poor countries. Whatever the alternate uses turn out to be, one cannot escape the fact that a tradeoff exists between protecting the poor and other goals.
The Constitutional Right to Save Lives
Our friends at IJ have filed an exciting new lawsuit, one that, if successful, could save the lives of more than 1,000 people a year: people who die needlessly of assorted blood diseases (including leukemia) because the federal government criminalizes the offering of even modest compensation for bone marrow donation.
That is, the National Organ Transplant Act — which outlawed the sale of kidneys and other organs — for some reason included bone marrow.
NOTA’s criminal ban is unconstitutional because it arbitrarily treats bone marrow like nonrenewable solid organs instead of like other renewable or inexhaustible cells – such as blood or sperm — for which compensated donation is legal. (That makes no sense because bone marrow, unlike kidneys, replenishes itself in just a few weeks, leaving the donor whole. )
The ban also fails constitutional muster because it irrationally interferes with the right to participate in safe, accepted, lifesaving, and otherwise legal medical treatment.
As Chip Mellor, president and general counsel of the Institute for Justice, said in a press release announcing the case: “Bad things happen when the federal government exceeds its constitutional authority. In this case, people actually die. The Institute for Justice intends to stop that and to restore constitutional constraints that prohibit arbitrary limits on individual liberty.”
IJ brought this suit on behalf of adults with deadly blood diseases, the parents of sick children, a California nonprofit, and a world-renowned medical doctor who specializes in bone marrow research. You can find more information here. Perhaps more interestingly, IJ senior attorney Jeff Rowes is guest-blogging about the case all week at the Volokh Conspiracy. Here’s his first post.
Department of Bad Analogies
US Ambassador's residence, Paris
In the course of wondering whether it may not be so important that so few US government personnel speak Pashto, Spencer Ackerman writes:
You don’t have to speak French to craft a good U.S. France policy.
That’s a fair point, although many, many more U.S. diplomats dealing with France speak French than do the folks dealing with Afghanistan speak Pashto (or Dari, or…). But the problem is that we don’t have a normal diplomatic relationship with Afghanistan — we’re trying to transform the entire society. Counterinsurgency guru David Kilcullen tells us Afghanistan is all part of a “global counterinsurgency.” [.pdf] This, of course, is a somewhat more ambitious job than blowing through the cocktail circuit in Paris.
Just to press the point, as only one of eight “best practices” for counterinsurgents, Kilcullen lists “cueing and synchronization of development, governance, and security efforts, building them in a simultaneous, coordinated way that supports the political strategy.” Another COIN guru, John Nagl writes [.pdf] that “The soldiers who will win these wars require an ability not just to dominate land operations, but to change whole societies…”
In short, we probably ought to distinguish between France and Afghanistan.
If China Jumped Off A Bridge, Would We Do It Too?
Everyone has heard that China is leaving us in its dust when it comes to producing college graduates, and if we don’t do something drastic to catch up they’ll crush us economically as well. Indeed, it’s a driving force behind efforts to ramp up federal higher education intervention.
As President Obama proclaimed when introducing his American Graduation Initiative, which is now part of the ironically titled Student Aid and Fiscal Responsibility Act:
By 2020, this nation will once again have the highest proportion of college graduates in the world….Already we’ve increased Pell grants by $500. We’ve created a $2,500 tax credit for four years of college tuition. We’ve simplified student aid applications….A new GI Bill of Rights…is beginning to help soldiers coming home from Iraq and Afghanistan to begin a new life — in a new economy. And the recovery plan has helped close state budget shortfalls…at the same time making historic investments in school libraries and classrooms and facilities all across America. So we’ve already taken some steps that are building the foundation for a 21st century education system…one that will allow us to compete with China and India and everybody else all around the world.
Now, while a college education could furnish important learning that helps drive innovation and economic development, it could also be as worthless as conferring a bachelor’s degree on a dog. What’s important is that people actually learn things of value, not simply that they get degrees. But a funny thing happened in China…
Yesterday, news broke that China’s top education official has been sacked. Reports the New York Times:
Facing rising criticism over the quality of schools and a crush of jobless college graduates, China’s legislature announced Monday that it had removed the minister of education after six years on the job and replaced him with a deputy.
China has been cranking out college graduates at a breakneak pace, but the quality of the education has become highly suspect and, perhaps more importantly, there haven’t been nearly enough jobs to employ all the newly credentialed. In other words, simply producing more graduates — no matter how much it has frightened some people in America – has largely been a waste.
The obvious lesson from this should be that it’s foolish to simply make massively expanding the ranks of degree holders a national goal. But that doesn’t compute for many U.S. politicians, despite abundant evidence that we don’t need heaps more graduates anymore than China does. It’s getting elected that matters most to politicians, and as long as voters keep believing that government is opening the door to the middle class simply by pushing more and more people to college, politicians will keep wasting taxpayer dollars on unnecessary degrees.
So let’s hope that both voters and politicians will learn China’s clear college lesson: Fixating on degrees is not very smart. Failing that, let’s hope that we at least don’t have any rioting…
‘The End of Privacy’ and the Surveillance-Industrial Complex
National Public Radio’s All Things Considered ran a series on “The End of Privacy” all last week that’s worth a listen. They’re primarily concerned with the ways private companies have access to vast quantities of information about individuals in the digital age—something that civil libertarians have traditionally been less concerned about than government access, for many perfectly valid reasons. But it’s worth noting how porous that distinction can be. A 2006 survey by the Government Accountability Office found that just four government agencies—the Justice Department, Department of Homeland Security, State Department, and Social Security Administration—spent at least $30 million annually on contracts with information resellers like Choicepoint. The vast majority of that data (91%) was used for law enforcement or counterterror purposes. And GAO found that the resellers weren’t always in full compliance with the privacy practices that the agencies themselves are supposed to follow.
Choicepoint, coincidentally, is one of the largest clients of the consulting firm run by former Attorney General John Ashcroft. Little wonder given the amount of cash at stake: As reporter Tim Shorrock has documented, some 70 percent of our vast intelligence budget is channeled through private-sector contractors, which means that we need to understand government surveillance policy in the context of a “surveillance-industrial complex” that parallels the more familiar military-industrial complex known for bringing us $600 toilet seats and other forms of pork in camo gear. It’s worth bearing in mind that it’s not just investigatory zeal and public fear driving the expansion of the surveillance state—a lot of people are making a lot of money off it as well.
Monday Links
- The “Karzai problem” in Afghanistan: “The U.S. has assisted and sponsored a corrupt, illegitimate and slightly autocratic regime there while purporting to advance the values of freedom and democracy.”
- Did it work? Cato’s Jeffrey Miron debates the effectiveness of Obama’s stimulus plan.
- The Democrats’ internal battle: Why they can’t agree on how to overhaul the health care system.
- The limits of American power in Afghanistan.
Health Care Bill Improves Lawyers’ Financial Health
The great thing for legislators about a nearly 2000 page bill — such as, oh, the House’s latest health care salvo — is that very few people bother to read the whole thing. So it’s easy to bury little gifts to favored supporters. Or big ones.
For example, check out section 2531 — that’s pages 1431-33 for those following along at home — which has gone largely unnoticed in the major news cycle. These three pages of the bill reward states that refrain from setting (or repeal) any caps on medical malpractice rewards — and the accompanying lawyers’ fees! – by requiring the Secretary of Health and Human Services to provide them a bribe an “incentive payment.”
As Hans von Spakovsky notes at NRO’s Corner, this “alternative medical liability law” aims to eviscerate cost-saving measures that protect doctors from frivolous lawsuits that increase the cost of health care to the consumer. So this has nothing to do with providing better or cheaper care, covering the uninsured, or even eliminating waste and fraud. Instead, it’s a pure sop to one of the Congressional Democrats’ key constituencies: trial lawyers.
For more information on free market health care reform alternatives, please visit Cato’s Health Care website here.
The Bell Curve Mean Business
Over the past month, Charles Murray and I have been debating the proposition that better schools can significantly improve educational outcomes – can shift the “Bell Curve” substantially to the right. Charles finds this “touchingly naïve,” while I argue that it is empirically inescapable.
Ben Chavis, founding principal of Oakland’s extremely high scoring American Indian Public Charter Schools, has invited Charles to put his skepticism to the test, and perform research to validate or refute the achievements of Ben’s inner-city students. But Charles believes he’d find only a modest (< 0.25 std. dev.) test score effect to AIPCS attendance, that would, moreover, be evanescent. Charles grants that Ben has created a very good school, he’s just convinced that even very good schools cannot have large or lasting academic effects.
The evidence simply does not support Charles’ skepticism.
I’ve already noted that there are average effect sizes for market education systems that are much greater than Charles’ threshold. Just a few months ago, it was reported that three years in private schools under DC’s voucher program raises reading achievement by two grade levels (0.42 std. dev.), and effect sizes of even 2/3ds of a std. dev. are not unheard of.
Those are average effect sizes of competitive education markets over public school monopolies. Since we agree that Ben’s school is quite special, there is every reason to expect his school’s effect size to be on the high end of the range already identified in the research.
And what of Charles’ assumption that school effects are necessarily evanescent, fading to insignificance within a few years after students leave the school? This, too, is contradicted by the evidence. Numerous studies have looked at long term effects of consuming market schooling instead of monopoly schooling – particularly on students’ eventual success in college and their earnings once they’ve entered the labor market. Economist Derek Neal has found that urban blacks attending Catholic schools are twice as likely to graduate from college as similar students attending public schools. That is a large effect several years out, and it, in turn, will have an enduring positive effect on students earnings. In fact, of 17 research findings comparing the eventual educational attainment and earnings of market school graduates to public school graduates, 11 find statistically significant positive effects, and none find significant negative effects (see Table 3 in the previously linked paper).
The evidence is clear that competitive education markets have significant, lasting, and often quite substantial positive effects over government school monopolies. So I can see no empirical basis for Charles’ skepticism.
What’s more, this should be intuitively obvious. The current mean of the bell curve of educational achievement is not some inescapable fact of nature, like the value of pi. It is a symptom of the monopoly school systems that have stifled educational efficiency and innovation for more than a century. Just as establishing the rule of law and liberating economies from the thrall of central planning have led to dramatic economic growth around the world, so would liberating education from the thrall of government school monopolies shift the bell curve to the right.
NY 23: A Return to Principle?
At today’s Politico Arena the editors ask:
NY 23 and the GOP: The road to “first principles” or to “internecine ruin?”
My response:
In important respects, the NY 23 congressional race is a microcosm of the Goldwater/Rockefeller battle of 1964 — a battle for the soul of the Republican Party. For years during the 1950s and ’60s, “Rockefeller Republicans” were not simply ”Democrat Lite” but often to the left of Democrats, giving rise back then to the New York Conservative Party, which nominated Doug Hoffman for the NY 23 seat at stake tomorrow. And the policies those Republicans put in place, starting with taxes, were directly responsible for the relentless decline of the Empire State. As reported in a recent Empire Center study, “New York’s share of the nation’s population declined sharply in the second half of the 20th century, from 19 percent of all Americans in 1950 to less than 7 percent in 2000.”
Goldwater won that intra-party battle, of course, then lost an election all but foreordained by the Kennedy assassination. And with Goldwater’s victory for the soul of the Republican Party, the parties were at last distinguished by their principles, even if a remnant of Rockefeller Republicans, like the two Bushes, remained to muddy the waters.
The NY 23 situation captures this perfectly. Nominated not in a primary but by a few party officials, Dede Scozzafava’s indifference to Republican Party principles was no better illustrated than by her decision, when it became clear how badly she was losing, not simply to remove herself from the race but to endorse the Democratic nominee — in an apparent back-room deal with state and national Democrats. We’ll doubtless know in time just what promises were made for that endorsement. But it reeks already of the lust for power over principle: Do whatever it takes to stay in the political game.
It’s impossible to predict the outcome of this election, of course. Some of Scozzafava’s loyalists will probably follow her, while others will be moved by a sense of betrayal to go the other way. The larger question, however, is whether we are going to have two significantly different parties in this nation – or simply two parties vying for power, with barely a dime’s worth of difference between them. The Obama administration’s lust for power, making Bush look like a piker, has brought the Goldwater/Reagan revolution back to life. But the Wall Street Journal‘s sober editorial this morning got it exactly right: Whether this revival returns the GOP to first principles or leads to internecine ruin “will depend on how GOP leaders and conservative activists respond.” Both could do worse than look to Ronald Reagan for guidance.
The World’s Best Tax Haven: In America, but Unavailable to Americans
Tax competition is an issue that arouses passion on both sides of the debate. Libertarians and other free-market advocates welcome tax competition as a way of restraining the greed of politicians. Governments have lowered tax rates in recent decades, for instance, because politicians are afraid that the geese that lay the golden eggs can fly across the border. But collectivists despise tax competition — for exactly the same reason. They want investors, entrepreneurs, and companies to passively serve as free vending machines, dispensing never-ending piles of money for politicians. So when a left-wing group puts together a ranking of the world’s “top secrecy jurisdictions” in hopes of undermining tax competition, proponents of individual freedom can use that list as a guide to world’s most investor-friendly nations. The good news is that an American state, Delaware, is number one on the list. And since being a tax haven is a magnet for investment, this is good news for U.S. competitiveness. The bad news is that American taxpayers are not allowed to benefit from many of Delaware’s “tax haven” policies. Here’s what a left-wing columnist in the United Kingdom wrote about the issue:
You’re a billionaire but you don’t want anyone, least of all the taxman, to know. What do you do? Head for a palm-fringed island paradise or a snow-covered Alpine micro-state? Wrong. The world’s most opaque jurisdictions – the ones that will best shield you and your cash from the light – are mostly in the heart of the most sophisticated and powerful global financial centres. London, Luxembourg and Zurich are in the top five most secretive jurisdictions, according the first comprehensive index of financial transparency ever compiled. Yet top of the pile, beating the British Virgin Islands, Belize or Liechtenstein as the best place to hide wealth, is Delaware. One of the smallest states in the US, it offers the best protection for anyone who does not want to disclose their identity as a beneficial owner of a company. That is one very good reason why the East Coast state hosts 50% of the US’s quoted firms and 650,000 companies – almost equivalent to one company per Delaware resident. …Delaware – the political power-base of the US vice-president, Joe Biden – offers high levels of banking secrecy and does not make details of trusts, company accounts and beneficial ownership a matter of public record. Delaware also allows companies to re-domicile within its borders with minimal disclosure, and allows the existence of privacy-enhancing “protected cell” or “segregated portfolio” companies, among many other stratagems useful for protecting the identity of those who do business there.
Cato on Facebook
Cato on Twitter
Cato on Google+
Cato on YouTube
