Archive for January, 2011
White House Backs Off of Obama Earmarks Pledge
In the state of the union speech last night, President Obama said with great force:
[I]f a bill comes to my desk with earmarks inside, I will veto it.
This appeared to settle the earmark question once and for all. The Republican House and Republicans in the Senate had already sworn off earmarks. Senate Democrats, who may have been holding out hope for preserving this prerogative, will not get to do earmarks. So says the president of the United States, veto pen in hand.
But late last night the White House may have begun to modify the president’s pledge. A “government reform factsheet” circulated by White House staff says, “The President intends to veto bills with special interest earmarks.” (emphasis added) This appears to create a class of earmarks that will bring the president’s veto, special interest earmarks, and a class that will not—national interest earmarks, one supposes.
Defining what is an “earmark” is difficult, though not impossible, as the groups that have worked on the earmarking problem can tell you. But the distinction between “special interest earmarks” and “national interest earmarks” appears to be something the president would make for himself. This withdraws a great deal of force from the “no earmarks” pledge.
It’s certainly possible that the “special interest” language in the fact sheet is surplussage simply meant to illustrate that earmarks are a “special interest” problem. But we will have to watch and see whether the president walks away from his statements about controlling earmarks, as he has done before.
Is Obama Serious?
Today POLITICO Arena asks:
Although President Obama proposed a five-year, $40 billion per year freeze in non-security, discretionary spending, and Republicans want to cut spending by at least $100 billion a year, is either side serious about real spending cuts?
My response:
With uncontrolled deficits well into the future and a debt exceeding $14 trillion, for Obama to propose saving only $40 billion per year in discretionary spending over the next five years, while “investing” in pie-in-the-sky things like high-speed rail, wind farms, environmentally destructive ethanol, and the like, is worse than unserious — it’s an insult to our intelligence. Like Obama, many Republicans too treat military spending, among other things, as sacrosanct, but at least they’re proposing more serious budget cuts.
The deeper problem, of course, is systemic. Socialism, a large dose of which we have in America today, brings out the very worst in people. In the name of collective responsibility, it saps and then destroys individual responsibility, leading to a war of all against all. No one wants “his” entitlement cut for fear that his neighbor might profit at his expense — because, after all, “we’re all in this together.” Suspicion and envy are the order of the day. Meanwhile, dreamers like Obama (at least that’s his pose), who promote our collective drift, either can’t or won’t grasp the hard reality until it crashes down upon them, and us, as it is doing now in several of our states and in Europe. For the “hard-hearted” realists among us, November 2012 can’t come soon enough.
Patriotism, Dedication, and Esprit de Corps
From a press release by Law Enforcement Against Prohibition:
[A] U.S. Customs and Border Protection agent… was fired for saying in a casual conversation that legalizing and regulating drugs would help stop cartel violence along the southern border with Mexico. After sharing his views with a colleague, the fired agent, Bryan Gonzalez, received a letter of termination stating that his comments are “contrary to the core characteristics of Border Patrol Agents, which are patriotism, dedication, and espirit [sic] de corps.” Last week, with the help of the American Civil Liberties Union of New Mexico, Gonzalez filed a lawsuit seeking damages.
I know very little about employment law and have no idea whether the agent has a case. But just consider that even some Border Patrol agents are questioning the War on Drugs — and even when it can cost them their jobs.
If it costs you less to speak out, then please, consider doing so. American patriotism is about speaking one’s mind. Dedication to a failed policy isn’t a virtue. And will the firings continue until the esprit de corps improves?
Obama Supports Repealing 1099 Rule
In addition to a corporate tax cut, Obama takes another one out of Cato’s playbook in his State of the Union address. He supported repealing an idiotic IRS requirement in the 2010 health care law that mandated hundreds of millions of additional 1099 tax forms. The president said: “We can start right now by correcting a flaw in the legislation that has placed an unnecessary bookkeeping burden on small businesses.”
I called for that reform back in April. Now it’s the GOP’s job to get him legislation to repeal this provision tomorrow.
Obama Calls for Corporate Tax Cut
In his State of the Union, President Obama pulled one from the Cato playbook and called for a corporate tax rate cut.
“But all the rest [of our companies] are hit with one of the highest corporate tax rates in the world. It makes no sense, and it has to change. So tonight, I’m asking Democrats and Republicans to simplify the system. Get rid of the loopholes. Level the playing field. And use the savings to lower the corporate tax rate for the first time in 25 years – without adding to our deficit.”
The stuff about loopholes and simplification–that’s window dressing. The real story is that the reality has sunk in even to liberal Democrats that we are shooting ourselves in the foot with the highest corporate tax rate in the world.
“Loopholes” will take care of themselves if we dramatically lower our tax rate. Chopping the statutory rate will automatically broaden the tax base, close homemade corporate loopholes, and not “add to our deficit” in the long-run.
Cato Live Blog of President Obama’s 2011 State of the Union Address and GOP Response
Please join us at 9:00pm Eastern on Tuesday, January 25, 2011 for live commentary during President Obama’s State of the Union address and the response given by House Budget Chairman Paul Ryan (R-Wisc.). Here is our panel of expert bloggers (click each name for their respective Cato@Liberty archives):
- Director of Information Policy Studies Jim Harper
- Trade Policy Analyst Sallie James
- Director of Health Policy Studies Michael F. Cannon
- Senior Fellow Daniel J. Mitchell
- Director of the Center for Educational Freedom Andrew J. Coulson
- Research Fellow in Defense and Homeland Security Studies Benjamin H. Friedman
Other Cato scholars may also be contributing.
Come back to this page at 9:00pm Eastern on Tuesday, January 25, 2011 to join us–we look forward to having you, and to sharing our insights with you.
Also, don’t forget to tune into our Facebook page immediately following this live blogging event for live video reaction to the speeches from Vice President Gene Healy and Research Fellow Julian Sanchez.
USPS Takes Another Shot at Closing Outlets
The U.S. Postal Service, which lost $8.5 billion last year, wants to close about 2,000 retail postal outlets that are operating in the red. The USPS wanted to close 3,200 outlets in 2009, but the number was chopped to 162 following a congressional outcry. The USPS has over 36,000 postal outlets.
According to the Washington Post’s Ed O’Keefe, the USPS learned a lesson from its congressional beating last time around, and is coming back at Congress with more data:
The incident compelled officials to establish the computerized process they began using in November, Granholm said. He’s meeting regularly with colleagues to review potential sites, starting with small, rural stations in communities such as Mahaska, Kan., and Barium Springs, N.C.
With a few clicks of his mouse, Granholm can pull up fact sheets detailing a location’s square footage, hours of operation, payroll, annual sales and maps showing the next-closest location. If an unprofitable site employs fewer than five people, is open fewer than eight hours a day and is within 15 to 20 miles of another, larger location, it’s likely to close.
The USPS is only targeting postal stations and branches. Traditional post offices, which number about 27,000, cannot be closed “for solely operating at a deficit” and the closure process is burdensome. A Cato essay on privatizing the U.S. Postal Service explains that the USPS’s overcapacity is becoming a bigger financial drag as the demand for its retail services continues to decrease:
Full post offices are more costly to operate than other means of serving customers. The average post office transaction cost 23 cents per dollar of revenue in 2009 while the average transaction at a contract postal unit cost just 13 cents. Post offices used to generate almost all postal retail revenue, but 29 percent is now generated online through usps.com and other alternative channels.
In 2009 post offices recorded 117 million fewer transactions than in 2008. Four out of five post offices are operating at a loss. However, the postal network’s overcapacity has drawn little corrective action from Congress. In fact, legislation introduced in the House with 102 cosponsors would apply the burdensome procedures for closing post offices to other postal outlets as well. Congress is actively working against the modernization of the U.S. postal system.
The USPS needs to adjust to the times, but congressional meddling makes the task nearly impossible. The solution is to separate the government from the postal business altogether and allow the private sector to provide mail services, just as it provides package delivery and countless other services.
SOTU, Brute?
In tonight’s State Of The Union address, President Obama is expected to call for increased government education spending on the theory that this will improve outcomes, raise productivity, and make us more internationally competitive.
Really? Again?
I already offered a thorough debunking of the notion that increased federal (or total) education spending has improved U.S. student achievement on the eve of last year’s SOTU, and thanks to the miracle of the intarwebs, there’s no need to repeat it here.
But the president is not simply advocating a strategy that is a proven failure, he is plunging a dagger into the heart of the one federal education program that is a proven success. There is already a program that is producing better educational outcomes at a quarter of the cost of the status quo: the Washington, DC Opportunity Scholarships Program. It pays private school tuition for poor DC kids, at an average cost of about $7,000. Participating parents are happy with their chosen private schools, test scores are as good or better than those in the public schools, graduation rates are significantly better than in the public schools, and, here’s the clincher: DC is spending four times as much per pupil on its district public schools… over $28,000 a year.
Yes, I know, they claim it’s less. But if you simply add up the k-12 spending numbers for the District of Columbia, ignoring charter schools and higher ed., it comes to $28,000 per child. Don’t take my word for it, here’s a spreadsheet with all the numbers as well as links to the official budget documents.
While the media have been shy about reporting DC’s actual public education spending figures (maybe the MSM can’t afford a copy of Excel these days?) there’s one thing they’ll have a hard time not reporting on tonight: the Opportunity Scholarships program itself. That’s because Speaker John Boehner has invited students, parents, and teachers who have participated in that program to attend the SOTU with him. You can catch our liveblogging of the event here, and it’ll be interesting to see how the different networks cover this particular story.
How to Think & Talk About Vouchers & Ed Tax Credits
School Choice Week is here, and there are a lot of people trying to spread the good word about the benefits of increasing educational freedom.
But what benefit of choice is best to focus on?
You can make at most a few points in an oped or on talk radio. On TV, and even in print reporting, you’re lucky to get one point across. And with friends and family, and even politicians, you need to keep the focus where it will do the most good.
So, should you focus on how horrible inner-city schools are, how many lives are destroyed in a failing government system? Maybe. Depends on the person, certainly.
But the evidence suggests that the best message overall is one that focuses on the financial benefits of school choice (and this is even before the financial crisis). People think about vouchers and education tax credits differently. And be careful trying to pull at Democratic heart-strings with arguments that choice will increase educational equity for poor kids . . . there’s evidence that it backfires!
Take a look at this slide presentation that describes how the public thinks about private school choice, what you should emphasize, and what you should be careful with . . . it’s not just my opinion, it’s based on evidence from a unique message experiment:
NAEP: If the Scores Don’t Rise, You Must Revise!
New science test scores on the National Assessment of Educational Progress were released today, and they’re not comparable to the scores for earlier years. You may want to know whether our schools are getting better or worse over time in this subject, but apparently the federal government is more ambivalent.
There are actually two different flavors of the NAEP tests: the Long Term Trends (which stay the same over time so that we can see, well, trends), and the “Nation’s Report Card,” which can be redesigned whenever it is absolutely… convenient.
But here’s the thing: the NAEP Long Term Trends science test has not been administered since 1999, when it showed that a statistically significant decline in achievement had taken place at the end of high school since the test began in 1974 (see the chart below). If there’s an official reason for its discontinuation, I’m not aware of it.
The “Nation’s Report Card” science test that was administered in 1996, 2000, and 2005 also showed a statistically significant decline over that period at the end of high school. Today America learns that that test has been discontinued, too. The new “Report Card” science test is not comparable to the earlier one, so now we have no national measure of science trends at all.
Maybe there’s an excellent reason why the federal government no longer wants to measure trends in science achievement, but if there is, I suspect it’s political rather than educational.
Showdown on Homeland Security
If you haven’t seen it already, I recommend the Frontline report Are We Safer? Since September 11, 2001, the government has gone on a spending spree without any regard for fiscal federalism, dumping $31 billion into grant programs. The program is based on The Washington Posts’ Top Secret America article, “Monitoring America.” Watch it below:
Much of this spending has gone to local pork projects or allowed state and local governments to avoid the realities of budgeting – spend federal counterterrorism dollars on normal law enforcement requirements while spending the local tax base on unsustainable pensions for public employees. For a tally of this excess, check out the Price of Peril, an interactive map showing homeland security spending by state, courtesy of the Center for Investigative Reporting.
All of this spending isn’t without cost to our civil liberties. The recipients of the money have to show something, hence the rise of fusion centers across the nation and the scaremongering reports they produce. There simply aren’t enough terrorists to go around.
Two of the people featured in the Frontline report, Mike German of the ACLU (and former FBI agent) and Harvey Eisenberg, Chief, National Security Section, Office of United States Attorney, District of Maryland, squared off at a Cato Institute event in 2009. Check it out here. Pay special attention to Eisenberg’s remarks at 53:35, where he misstates the threshold for starting a domestic counterterrorism investigation under the Attorney General Guidelines.
Mike German corrects him — the 2008 guidelines loosened the standard such that agents don’t even need a reasonable suspicion of criminal activity to investigate someone. Eisenberg responds that he requires it for all of his investigations. That’s admirable, if true, but a bit unnerving that the policy change is news to him.
Public Education Needs Transparency & Competition, Not More Money
In honor of School Choice Week, President Obama seems set to use his SOTU address this evening to demonstrate how truly pathetic most education “reform” ideas are in this, the era of our Great Recession.
We are, and have long been, out of money at the Federal level. So, naturally, the President proposes more “investment,” ah, spending in education. Of course, we know that Fed Ed spending does diddly to improve test scores.
But at least with the Feds, we have a fairly good accounting of how much is being spent on K-12 education.
Unfortunately, at the state, local, and school-district level, it takes a forensic accountant to discover how much we’re really spending.
Watch this video to get an idea of why public K-12 education is the most unaccountable, least transparent government service in the nation:
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