Archive for August, 2010
Travel after the Fall of the Iron Curtain
In the sumer of 1992, I lived and studied in Prague. I was keen on seeing life in Eastern Europe after the end of Soviet domination.
It was invigorating to think that my local law professor headed over the Vltava River in the afternoons to work on the new constitution in the Prague Castle. It was fascinating to learn of the “lustration” process by which participants in Soviet-era wrongs were penalized but not ostracized. Out of habit, no Czechs ever talked on the subway. Americans did.
There were other reminders of the old order. My overnight train to Katowice, Poland, from which I planned a connection to Krakow, stopped in the middle of nowhere. In the pitch black night, the sound of border guards throwing open train compartments and making demands in a foreign tongue brought forth fearsome movie-memories of life under totalitarianism.
They pulled a young man from my compartment and took him off the train. I don’t remember if it was a Central or South American passport, but it was one that doesn’t afford its bearer the luxury of easy international travel that Americans enjoy.
I honestly don’t remember if he was allowed back on the train. I’m just glad that era is over.
Duncan’s Invitation Just the Start of the Problem
So U.S. Secretary of Education Arne Duncan invited every Education Department employee to attend Rev. Al Sharpton’s Glenn Beck counter-rally. As David Boaz explained in the Examiner, it was a ”highly inappropriate” thing to do, pushing people who are supposed to serve all Americans to support one side of a “political debate.” But that’s just the most obvious problem with Duncan’s weekend doings.
Perhaps just as troubling as his rally-prodding is that Duncan declared education “the civil rights issue of our generation” at Sharpton’s event. This only about a year after helping to kill an education program widely supported by many of the people he and Sharpton insist they want to empower. I’m talking, of course, about Washington, DC’s, Opportunity Scholarship Program, a voucher program that was proven effective. But the heck with success — Duncan and President Obama let the union-hated program die.
The cause for concern, though, doesn’t end there. According to the Examiner, an Education Department spokeswoman tried to gloss over the boss’s out-of-bounds play by suggesting that Sharpton’s rally was but a mere “back-to-school event.” Sound familiar?
That’s right! As I just blogged about, last year the Obama administration scared parents and taxpayers across the country by sending politically charged material to all public schools to prepare them for the president’s planned address to the nation’s children. Only after it took serious heat for that did the administration have the most alarming material changed. And then what did it do? Declared that the address would obviously be but a simple back-to-school speech, and tried to make everyone who knew what had actually transpired seem like a partisan attack dog.
As long as politicians run education, education will be hopelessly politicized. Unfortunately, that’s the simple back-to-school lesson for today.
South Carolina Gov Race: What’s Haley Thinking on School Choice?
Nikki Haley promises to be a star governor if–most likely when–she’s elected this fall by South Carolina voters. Word is she’s a committed fiscal conservative, and her background is steeped in a successful family business, not large corporations, so she should have an intuitive grasp of what makes our economy grow.
And Haley has a long, solid record of supporting school choice through education tax credits in South Carolina. As recently as August 19th, Haley was reported as saying, “like Sanford, she would veto a bill to expand public education options unless it included help with private tuition. She agreed with Sanford that it must be all or nothing, saying otherwise the Legislature won’t return to the debate.”
Now that’s the stuff.
But Haley has recently put out some concerning and confusing statements on school choice. “Haley said approving private-school choice, which would provide tax credits or vouchers to pay private-school tuition, was not a priority. ‘That is not my focus; my focus is the school funding formula,’ Haley said.”
Changing the funding formula is all well and good. It might save some money. But it will NOT improve education in South Carolina. Education tax credits will improve performance and save much more than any public school reform. School choice should be Haley’s only education issue.
Why is she backing away all of a sudden? Sure, the primary is over, but Haley is leading comfortably in the polls. Education tax credits pull down serious majority support across nearly every single demographic in South Carolina. White voters, black voters, old and young, Republicans and even Democrats. This is a great issue. And backtracking on a signature issue could tarnish her fresh, reformer image.
Most important, school choice is the right policy. Haley always seemed to have a deep understanding that only an education tax credit program can substantively improve education in South Carolina.
Senator Jim DeMint has a great short video plug for school choice out . . . let’s hope Haley takes a look at this, remembers what reform really matters, and does the right thing in office.
Free Trade Consensus Remains Intact in Australia
As many of you may know, Australia had a federal election on August 21 that yielded an at-time-of-blogging inconclusive result. As a consequence, the Liberal-National coalition (currently in opposition) and the Australian Labor Party are both wooing the Green and Independent members in the hope of securing their support. A Canberra-based friend sent me a link to an article in today’s (or, strictly speaking given the time difference, yesterday’s) Australian about the trade-related aspects of the current negotiations to form a minority government.
I’ll admit, the story had me worried. I’ve bragged before about Australia’s bipartisan political consensus on free trade, and it looked as though that was under threat. According to the article, Labor — the party responsible for much of the unilateral trade liberalization undertaken in the 1980s – was considering “re-erecting tariff walls”:
Yes, modern Labor has degenerated to the point where the Treasurer allows the prospect of protectionist horse-trading to be part of the equation for forming Australia’s next government. And so Australia’s political deadlock threatens to encourage the rise of a new industry protectionism driven by the anti-capitalist Greens in cahoots with left-wing trade unions and rural populism…
A few hours later, a new, happier story was filed on the Australian‘s website:
…Ms Gillard used her press club speech to offer continuity and certainty, but made clear she would not seek [Independent] Mr Katter’s vote by pandering to his passionate rejection of free trade, which he believes has ravaged sectors such as the sugar industry in his north Queensland seat of Kennedy.
“You’re talking to the leader of the political party that literally went to hell and back to modernise the Australian economy, including reducing tariff barriers,” Ms Gillard said.
“That is our heritage, that is our belief, that is in us.
“We would not have the modern resilient Australian economy we have now if Labor had not built it.
I’ll ignore that last preposterous statement about a political party building an economy, and instead focus on the main thrust of Ms. Gillard’s comments, which should come as a relief to free-traders everywhere, especially in Australia.
Let’s Open a Wireless Window to Cuba
Three of the world’s largest companies involved in wireless telecommunications—Nokia, AT&T, and Verizon—this week asked the Obama administration to further loosen the U.S. embargo against Cuba. According to a Bloomberg News story this morning:
Nokia, the world’s biggest mobile-phone maker, is urging the U.S. to ease its 47-year-old trade embargo so it can sell handsets to Cuba. AT&T and Verizon, the largest U.S. wireless providers, urged regulators to make it easier for U.S. companies to directly connect calls to and from Cuba.
The almost half-century-old embargo no longer serves any legitimate national security purpose, as I’ve argued before. The remaining restrictions on providing wireless communication services only demonstrate how the embargo actually undermines our stated goal of bringing more freedom to the long-suffering people of Cuba.
To President Obama’s credit, he has done more than most presidents to ease the embargo, including modest steps such as easing travel restrictions for Cuban-Americans and authorizing telecommunications firms to offer limited service in Cuba. In practice, however, President Obama’s efforts have had little effect, and they have not gone far enough.
If the basis of current U.S. policy toward Cuba is democratic empowerment of its people, then removing telecommunications restrictions would be a logical and healthy next step. According to the Bloomberg story, Cuba still has the lowest mobile-phone penetration rate in Latin America. What better way to empower nearly eleven and a half million people than by easing restrictions on their communications with free residents of the democratic United States?
President Obama himself argued in a White House statement in April 2009 that two of the best ways to promote Cuban democratization were by “facilitating greater contact between separated family members in the United States and Cuba” and “increasing the flow of … information to the Cuban people.”
Here is an opportunity to translate those sound words into action.
The Likelihood of Repealing ObamaCare
The political science blog Rule 22 has a post discussing the likelihood of repealing at least some part of ObamaCare. Author Jordan Ragusa finds:
- If “the Republicans regain only the House in the upcoming election…the estimated likelihood of at [least] some repeal during the 112th Congress is 52 percent.”
- If “Republicans regain both chambers in the upcoming midterm…the estimated likelihood of at [least] some repeal is 59 percent.”
- If “Republicans regain unified control of government in 2012…the estimated likelihood of some repeal in the 113th Congress is 69 percent.”
Ragusa is predicting only that the odds are better than 50-50 that Congress will repeal some part of the law, such as the expanded 1099 reporting, which House Democrats have already moved to eliminate because small businesses find it so onerous. He is not laying odds on whether Congress will repeal the entire law or its most important and unpopular provisions (i.e., ObamaCare’s individual mandate).
His post does shed light on the likelihood of repealing the individual mandate, however. As the below graph shows, the probability of repealing any provision of major legislation rises in each of the next five Congresses (i.e., over the subsequent 10 years). After that point, the probability of repeal begins to fall.
Note that this graph shows the instantaneous probability of repeal. The cumulative probability is the area under the curve, and increases monotonically over time. Thus the probability that Congress will repeal some part of ObamaCare by 2020 is more than 13 percent.
Ragusa therefore concludes:
the newly enacted law will be most “at risk” not in the next Congress, but a decade from now. So sit tight.
Also noteworthy is that Ragusa presents only the probability of legislative repeal. The prospect that the courts may invalidate all or part of the law increases the probability that some day, ObamaCare will no longer be on the books.
New Colombian President Backs Debate on Drug Legalization
Colombia’s new president Juan Manuel Santos came out last week in support of a debate on drug legalization, endorsing the call made a few weeks ago by his Mexican counterpart, Felipe Calderón.
Santos even said that if Californian voters passed a ballot initiative this November to legalize marijuana, he would team up with the presidents of Mexico and Peru “to work out how we are going to react and what is going to happen after this referendum.”
This seems to confirm the reports of the Mexican newspaper El Universal which claimed that Calderón’s turn around in his willingness to discuss drug legalization came after meeting with then president-elect Santos, who told him that Mexico should lead a debate on drug legalization. A week ago, Costa Rican president Laura Chinchilla said she was open for a debate on legalizing marijuana [in Spanish], even though she personally was against it.
Santos’ statement came the same week that leading Latin American experts met in Rio de Janeiro for the 2nd Latin American Conference on Drug Policy that I spoke at. Among the speakers were government officials from several Latin American countries, representatives from international agencies such as the Pan-American Organization and the UN, and experts from academia and NGOs. Even though not all speakers favored drug legalization or decriminalization, most did. The experience of Portugal on the issue (thoroughly documented in a paper by Glen Greenwald published last year by Cato) was widely cited during the conference. One panelist, a Brazilian congressman from the incumbent Workers Party, said that Brazil needed to adopt the same model as Portugal.
Attitudes on drug policy are changing in Latin America. The question remains: Is anyone in Washington paying attention?
Bulldozing Homes, Billing Homeowners
Officials in Montgomery, Alabama, are bulldozing homes in their historic civil rights district — and billing the homeowners for the cost of demolition:
Christina Walsh of the Institute for Justice writes about this injustice at the Daily Caller:
Imagine you come home from work one day to a notice on your front door that you have 45 days to demolish your house, or the city will do it for you. Oh, and you’re paying for it.
This is happening right now in Montgomery, Ala., and here is how it works: The city decides it doesn’t like your property for one reason or another, so it declares it a “public nuisance.” It mails you a notice that you have 45 days to demolish your property, at your expense, or the city will do it for you (and, of course, bill you).
Your tab with the city will constitute a lien on your property, and if you don’t pay it within 30 days . . . the city can sell your now-vacant land to the highest bidder.
The rest of her article is here. Also, see ABC News, Big Government and Reason magazine. And you can find Cato’s work on property rights here.
War in Iraq Not Over
President Obama will not declare “mission accomplished” in his prime-time speech on Iraq tonight, nor should he. He should not claim that a flowering democracy has been created in Iraq. He should not make unrealistic predictions about the long-term prospects for that shattered country.
The war isn’t over for the 50,000 U.S. troops left behind in Iraq. The president should recognize the sacrifice of all our troops, who have performed admirably. The war won’t be over for Americans back home until every last man and woman in uniform returns home safely from a conflict that has claimed so many lives and consumed so much treasure.
The president should reaffirm the strategic rationale for the drawdown set in motion by the Bush administration in consultation with the Iraqi government. Leaving U.S. troops in Iraq for another seven years will not make Americans safer. U.S. troops should not try to fashion a functioning state in Iraq. That task is the responsibility of the Iraqi government and the Iraqi people. Likewise, our troops should not serve as Iraq’s police force.
As our troops work hard to execute their mission, however, a rising chorus of voices is working diligently against the ultimate goal of U.S. withdrawal and Iraqi self-sufficiency. Some people are advising the president to leave a permanent U.S. military presence in Iraq, essentially arguing that the United States is the rightful guarantor of Iraqi sovereignty, and that the Iraqis simply can’t be trusted with security matters. The president has wisely turned aside such recommendations in the past, and should do so again.
A Federal Right to Obfuscate
H.R. 3421, the “Medical Debt Relief Act of 2009,” has nothing to do with relieving people of medical debts. It adds to the list of information credit reporting agencies may not communicate to their clients.
Current law bars credit bureaus from sharing truthful information about bankruptcies occuring more than ten years in the past, and lawsuits, judgments, tax liens, accounts placed in collection, or other adverse information more than seven years old, except in certain high-dollar credit transactions. This bill would add a new item to the list of officially banned information: medical debts that have been paid more than thirty days before a credit report is issued.
There are many cases, of course, where people who incur medical debts deserve our sympathy. But do they deserve our money?
If this bill becomes law, it will relieve people of one burden of medical debt. Lightening the obligation to save for a medically rainy day or carry health insurance, the bill will produce more people who fall on hard times due to illness or injury. These spendthrifts are worse credit risks than others, and their ability to obfuscate this will drive up the cost of credit.
The result? More expensive credit for everyone to cover the risk of medical debtors. A transfer of wealth from people responsible enough to save and buy health insurance to those who are not.
Not to worry, defenders of the law may say, Congress has findings in the bill saying that “medical debt collections are more likely to be in dispute, inconsistently reported, and of questionable value in predicting future payment performance because it is atypical and nonpredictive.”
The credit industry has a highly sophisticated cadre of analysts working to determine what facts and circumstances are, and are not, predictive of financial acuity. Congress does not. ‘Nuff said.
Economic Problems Won’t Be Solved by Education Stimulus, Either
Mark Calabria does a fine job dismantling Laura Tyson’s argument that we need another stimulus to spur private demand and revive the comatose economy. I would just caution against the one thing he could be construed as implicitly supporting: more federal funding for education.
I don’t dispute that there are mismatches between employers’ needs and potential employees’ skills, but the solution to the problem is not still more money going to education. As I and others have argued – especially the Pope Center’s George Leef, in a deft takedown of a recent workforce study — lobbing sacks of taxpayer dough at education will mainly enrich schools and their employees while making our resource-blowing education system even less efficient. Indeed, we already have far more bachelor’s degree holders than we have jobs for them, and the Labor Department projects that the greatest number of new jobs in the next decade will require only on-the-job training (see Table 2). And skills retraining? There are big problems there, too, with people often training for jobs that for numerous reasons they cannot get.
Putting more taxpayer money into “education” is one of those sweet sounding ideas that few people can ever resist, but which produces continually rotten outcomes. So even when it comes to education — shrill objections about “de-skilling” and being “anti-education” notwithstanding – the best thing to do for the economy is to let money stay with taxpayers and allow them to consume education as they would anything else: according to their individual priorities and abilities, which they know better than anyone else.
Obama Team Sounding the Right Notes on Export Controls
Certain headlines seem to re-appear in one form or another on a regular basis, such as “North Korea Threatens Military Action” or “Myanmar Junta Tightens Grip.” A leading example from the world of trade is, “Congress Weighs Export Control Reform.”
For the past 20 years, variations of that headline have appeared regularly, yet Congress never gets around to actually reforming our Cold-War-era restrictions on what U.S. companies can sell abroad. This week, in a welcome move, the Obama administration plans to announce administrative changes that will help to bring our export control regime into the 21st century.
As part of their constitutional duty to provide for the national defense, Congress and the executive have the legitimate power to regulate the sale of sensitive military products and technology to foreign entities. The problem is in the implementation. Export controls today cover products that have no real connection to national security, but the controls do make it more difficult for U.S. companies to compete effectively in global export markets.
The Obama administration has an extra incentive to reform export controls. In his State of the Union speech in January, the president announced the National Export Initiative, with the ambitious goal of doubling U.S. exports during the next five years. But as I pointed out in an op-ed a few weeks ago, our current export-control regime is a significant impediment to that goal.
The administration has been sounding the right notes. In a speech in April by Defense Secretary Robert Gates, and an op-ed today by National Security Adviser James L. Jones, the administration has signaled that it will allow a wider range of products to be sold abroad without special licenses while more effectively controlling the sale of technology that really would pose a danger in the wrong hands.
The next few days will tell us whether this administration is willing to take the steps necessary to make the long-promised reforms a reality.
Cato on Facebook
Cato on Twitter
Cato on Google+
Cato on YouTube
