Archive for November, 2011
Jury Nullification and Free Speech
Federal prosecutors are pressing their case against Julian Heicklen, the elderly man who distributed pamphlets about jury nullification. A lot of things are said about jury nullification and much of it is inaccurate. But whatever one’s view happens to be on that subject, I would have thought that the idea of talking about (and that includes advocating) jury nullification would be a fairly simple matter of free speech. We now know that the feds see the matter very differently. (FWIW, my own view is that in criminal cases jury nullification is part and parcel of what a jury trial is all about.)
In response to Julian Heicklen’s motion to dismiss his indictment on First Amendment grounds, federal attorneys have filed a response with the court. Here is the federal government’s position: “[T]he defendant’s advocacy of jury nullification, directed as it is to jurors, would be both criminal and without Constitutional protections no matter where it occurred” [emphasis added]. This is really astonishing. A talk radio host is subject to arrest for saying something like, “Let me tell you all what I think. Jurors should vote their conscience!” Newspaper columnists and bloggers subject to arrest too?
If Heicklen had been distributing flyers that said, “I Love Prosecutors. Criminals Have No Rights!” there would not have been any “investigation” and tape recording from an undercover agent. Any complaint lodged by a public defender would have been scoffed at.
First Amendment experts will know more than I about the significance of the “plaza” outside the courthouse and whether or not that’s a public forum under Supreme Court precedents. The feds make much of the fact that the plaza is government property. Well, so is the Washington mall, but protesters have been seen there from time to time. The plaza, however, is not the key issue. Activists like Heicklen would simply move 10-20 yards further away (whatever the situation may be) and the prosecutors seem determined to harass them all the way back into their homes, and even there if they blog, send an email, post a comment on a web site, text, tweet, or use a phone to communicate with others. After all, so many people are potential jurors.
Judges and prosecutors already take steps to exclude persons who know about jury nullification from actual service. And the standard set of jury instructions says that jurors must “apply the law in the case whether they like it or not.” But the prosecution of Heicklen shows that the government wants to expand its power far beyond the courthouse and outlaw pamphleteering and speech on a controversial subject. Once again the government is trying to go over, around, and right through the Constitution.
For previous coverage and additional info, go here, here, and here.
One Executive Order That Could Stop ObamaCare
A new memo from the Congressional Research Service explains that the next president cannot simply stop ObamaCare (“PPACA”) by executive order:
[A] president would not appear to be able to issue an executive order halting statutorily required programs or mandatory appropriations for a new grant or other program in PPACA, and there are a variety of different types of these programs. Such an executive order would likely conflict with an explicit congressional mandate and be viewed “incompatible with the express…will of Congress”…However, there may be instances where PPACA leaves discretion to the Secretary to take actions to implement a mandatory program, and…an executive order directing the Secretary to take particular actions may be analyzed as within or beyond the President’s powers to provide for the direction of the executive branch.
In other words, the worst elements of ObamaCare — the government price controls it imposes on health insurance, the individual mandate, and the new spending on health-insurance entitlements — are “statutorily required programs” that, say, President Romney cannot repeal or even halt by executive order.
However, there is one executive order that could effectively block ObamaCare, and that lies well within the president’s powers.
The Obama administration has issued a proposed IRS rule that would offer “premium assistance” (a hybrid of tax credits and outlays) in health insurance “exchanges” created by the federal government. The only problem is, ObamaCare only authorizes these tax credits and outlays in “an Exchange established by the State.” The administration did so because without premium assistance, ObamaCare will collapse, at least in states that do not create their own Exchanges. Yet the executive branch does not have the power to create new tax credits and outlays. Only Congress does. So if the final version of this IRS rule offers premium assistance in federal Exchanges, it will clearly exceed the authority that Congress and the Constitution have delegated to the executive branch.
In that case, the next president could issue an executive order directing the IRS either not to offer premium assistance in federal Exchanges or to rescind this rule and draft a new one that does not. The U.S. Constitution demands that the president “take Care that the Laws be faithfully executed.” Such an executive order therefore lies clearly within the president’s constitutional powers: it would ensure the faithful execution of the laws by preventing the executive from usurping Congress’ legislative powers.
While such an executive order would not repeal ObamaCare, as Jonathan Adler and I explain in this Wall Street Journal oped, it would “block much of ObamaCare’s spending and practically force Congress to reopen the law.”
You Can’t Make a Silk Purse out of ObamaCare’s Poll Numbers
The Kaiser Family Foundation’s November 2011 poll results on ObamaCare (“the ACA”) are now available. The gist:
After taking a negative turn in October, the public’s overall views on the ACA returned to a more mixed status this month. Still, Americans remain somewhat more likely to have an unfavorable view of the law (44%) than a favorable one (37%).
The survey also finds that individual elements of the law are viewed favorably by a majority of the public. The law’s most popular element, viewed favorably by more than eight in ten (84%) and “very” favorably by six in ten, is the requirement that health plans provide easy-to-understand benefit summaries. Also extremely popular are provisions that would award tax credits for small businesses (80% favorable, including 45% very favorable) and provide subsidies to help some individuals buy coverage (75% favorable, including 44% very favorable), as well as the provision that would gradually close the Medicare doughnut hole (74% favorable, including 46% very favorable) and the “guaranteed issue” requirement that prohibits health plans from denying coverage based on pre-existing conditions (67% favorable, including 47% “very” favorable)…
Far and away the least popular element of the health reform law is the individual mandate, the requirement that individuals obtain health insurance or pay a fine. More than six in ten (63%) Americans view this provision unfavorably, including more than four in ten (43%) who have a “very” unfavorable view.
I’ve written about such spin-heavy polls before, including here:
Rather than confront their own errors of judgment, [ObamaCare supporters] self-soothe: The public just doesn’t understand the law. The more they learn about it, the more they’ll like it…
This denial takes its most sophisticated form in the periodic surveys that purport to show how those silly voters still don’t understand the law. (In the mind of the ObamaCare zombie, no one really understands the law until they support it.) A prominent health care journalist had just filed her umpteenth story on such surveys when I asked her, “At what point do you start to question whether ObamaCare supporters are just kidding themselves?”
Her response? “Soon…”
And here:
Asking people whether they support the law’s pre-existing conditions provisions is like asking whether they want sick people to pay less for medical care. Of course they will say yes. If anything, it’s amazing that as many as 36 percent of the public are so economically literate as to know that these government price controls will actually harm people with pre-existing conditions. Also amazing is that among people with pre-existing conditions, equal numbers believe these provisions will be useless or harmful as think they will help…
[T]he pre-existing conditions provisions cannot exist without the wildly unpopular individual mandate because on their own, the pre-existing conditions provisions would cause the entire health insurance market to implode.
If the pre-existing conditions provisions are a (supposed) benefit of the law, then the individual mandate is the cost of those provisions. If voters don’t like the individual mandate–if they aren’t willing to pay the cost of the law’s purported benefits–then the “popular” provisions aren’t popular, either.
Or, as Firedoglake’s Jon Walker puts it, ObamaCare is about as popular as pepperoni and broken glass pizza.
See you again next month.
The ‘Tea Party Budget’
The “Tea Party Debt Commission” affiliated with FreedomWorks recently released a budget plan (download here). In formulating its plan, the commission took into account fifteen budget plans introduced by various groups and policymakers, including Cato’s Downsizing Government website.
The effort comes in response to criticism – valid in my opinion – that the amorphous tea party movement hasn’t been sufficiently specific on what should be cut from the federal budget. I think the plan is an adequate response to that criticism. The following are some additional comments on the plan’s contents:
- According to the commission’s calculations, the federal budget would begin running surpluses in fiscal 2015. Average spending over the next ten years would average 17.6 percent of GDP versus almost 24 percent for fiscal 2011. Gross and publicly-held debt would start to decrease. Assuming that the projections are accurate, the plan would represent a welcome – and necessary – reduction in the size and scope of the federal government.
- The plan embraces a Balanced Budget Amendment to the Constitution. I’m against a BBA, but their hearts are in the right place – in contrast to a lot of Republican policymakers who champion a BBA because they’re afraid or unwilling to get specific about what they’d cut.
- The plan calls for no tax increases but does not endorse a specific tax reform proposal. I give the commission credit for stating that acceptable tax reform “will never happen in the absence of massive spending cuts.” Kudos to the commission for not going along with the myopic fixation on tax cuts, tax cuts, tax cuts practiced by some individuals and policymakers.
- Specific cuts include eliminating the Department of Energy, Department of Education, HUD, the Small Business Administration, farm subsidies, and corporate welfare programs at the Department of Commerce. The plan also calls for the privatization of Amtrak, air traffic control, and the Transportation Safety Administration. Good stuff. One curious proposed cut is “end all foreign aid to countries that don’t support us.” That’s probably an unfortunate capitulation to tea partiers with neoconservative sympathies.
- On entitlements, the plan calls for allowing workers to divert one-half of their payroll taxes (employee share) to private accounts for retirement and medical needs. Medicaid would be block-granted to the states and capped. Medicare beneficiaries would be allowed to opt out of Medicare or enroll in the Federal Employees Health Benefit Program. Of course, the plan calls for the repeal of ObamaCare. Overall, I’d say not bad, but not great. It’s frankly depressing that these proposals will probably be labeled “radical” by establishment types.
- I’m unimpressed by the proposed defense cuts: too much talk about eliminating waste and duplication and almost nothing on reining in our global military empire. In fact, the plan expresses worry that the Budget Control Act’s sequestration cuts to defense “could weaken our defenses, perhaps to a dangerously unacceptable level.”
All in all, the plan contains a lot of good recommendations that policymakers should pursue – especially the ones who were elected, in part, by embracing the tea party movement.
Rent Control Violates Property Rights and Due Process
This blogpost was coauthored by Cato legal associate Trevor Burrus, who also worked on the brief discussed below.
Rent control is literally a textbook example of bad economic policy. Economics textbooks often use it as an example of how price ceilings create shortages, poor quality goods, and under-the-table dealings. A 1992 survey revealed that 93 percent of economists believe that rent control laws reduce both the quality and quantity of housing.
As expected, therefore, New York City’s Rent Stabilization Law—the most (in)famous in the country—has led to precisely these effects: housing is scarce, apartment buildings are dilapidated because owners can’t charge enough to fix them, and housing costs have only increased (in part because costs are transferred to non-rent mechanisms such as “non-refundable deposits”). Yet the RSL persists, benefiting those grandfathered individuals who rent at lower rates but hurting the city as a whole.
Harmon v. Kimmel challenges New York’s law on the grounds that it is an arbitrary and unsupportable regulation amounting to an uncompensated taking that violates the Fifth Amendment.
Jim Harmon’s family owns and lives in a five-story brownstone in the Central Park West Historical District. The Harmons inherited the building—and along with it three rent-controlled tenants. Those tenants have occupied apartments in the building for a combined total of 91 years at a rate 59 percent below market. In their lawsuit, however, the Harmons face many unfriendly precedents that have given states free reign to regulate property, to the point that it is occupied on an essentially permanent basis while surviving Fifth Amendment scrutiny.
One way to challenge some of these laws is to argue they are so arbitrary and poorly justified that they violate the Fourteenth Amendment’s Due Process Clause. Because this is an especially difficult type of challenge to bring, Cato joined the Pacific Legal Foundation and the Small Property Owners of San Francisco Institute on a brief supporting the Harmons’ request that the Supreme Court review lower-court rulings against them. Although the Court has ruled that the Takings Clause does not permit challenges based on claims that the alleged taking fails to “substantially advance legitimate state interests,” the Due Process Clause is an independent textual provision.
We thus clarify the relationship between property rights and due process, arguing that a law which advances no legitimate governmental purpose can be challenged under the Due Process Clause. To hold otherwise would be to deny property owners any meaningful avenue for defending their property from onerous and irrational regulations.
More on the Constitution’s Lack of a Drug-War Exception
Challenges to Florida’s unconstitutional drug laws continue to gain momentum. Following a successful federal district court challenge to the constitutionality of state statutes lacking a mens rea requirement (mental culpability, rather than, for example, incidental possession), people convicted under them have come forward en masse to ask Florida courts to reexamine their convictions.
As described in the background to a previous brief in the case of Florida Dept. of Corrections v. Shelton, the district court held that these sorts of laws offend the constitutional guarantee of due process. Florida’s Supreme Court has now consolidated over 40 appeals resulting from that federal court decision (which itself is now on appeal). Cato has once again joined the National Association of Criminal Defense Lawyers, Florida Association of Criminal Defense Lawyers, ACLU, Drug Policy Alliance, Calvert Institute for Policy Research, Libertarian Law Council, and 38 law professors on a brief supporting the rights of persons convicted under the “strict liability” statutes.
We urge the Florida Supreme Court to follow the federal district court’s lead and strike down laws prohibiting the sale, possession, or delivery of illicit substances without requiring mental culpability. That court now has the opportunity to reverse these unwarranted convictions and purge a nationally singular stain on civil liberties.
The name of the case is Florida v. Adkins.
Thanks to legal associate Paul Jossey for his assistance with this brief and blogpost.
GSE Loan Limits Fell…and Home Sales Went Up
On October first, the Fannie Mae/Freddie Mac maximum loan limit fell (from around $729,000 to $625,000). The Senate later voted to extend that limit until December 2013. Some House members, such as Rep. John Campbell (R-CA) warned that if the loan limits were not raised back to their previous levels, our housing market would “crater.” And of course the special interests in the real estate industry all but implied that if the taxpayer did not remain on the hook, then we’d all be living in caves before too long.
It was easy enough to make such outlandish statements in the absence of data. Now we have some data, and from of all people, the real estate industry. According to the National Association of Realtors (full disclosure: I worked there about 10 years ago):
Total existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, rose 1.4 percent to a seasonally adjusted annual rate of 4.97 million in October from a downwardly revised 4.90 million in September, and are 13.5 percent above the 4.38 million unit level in October 2010. [emphasis added]
You read that correctly. The loan limits fell and then home sales actually rose, which is the opposite of crater. I’m not claiming that the decline in loan limits caused home sales to increase, but I am claiming that the housing market did not crater, as was predicted.
The Less-than-Thrilled Case for Extending the Payroll Tax Holiday
When I think about taxes, my first instinct is to rip up the corrupt internal revenue code and implement a simple and fair flat tax.
When I think about Social Security, my first instinct is to copy dozens of other nations and implement personal retirement accounts.
Unfortunately, the political system rarely generates opportunities to enact big reforms that actually solve problems and increase freedom. Instead, we’re stuck with proposals that make things modestly better or modestly worse.
So you can imagine my sense of dissatisfaction that I’m getting peppered with questions about whether the one-year, two-percentage point payroll tax holiday should be extended.
But it’s more complicated than that. The Democrats in the Senate want to make the temporary tax cut even bigger and “offset” that tax cut with some soak-the-rich tax increases. Republicans, meanwhile, are frozen like deer in the headlights. They understandably don’t like the Democrat plan, but they seem reluctant to support anything else, not even a “clean” extension of the current policy.
Here are a handful of observations.
- The Democrat’s proposal for a one-year payroll tax cut financed by a permanent income tax hike on investors, entrepreneurs, and small business owners would be a big net negative for U.S. job creation and competitiveness.
- A “clean” extension of the payroll tax holiday would modestly improve incentives for work, but the temporary nature of the tax cut substantially weakens pro-growth effects.
- Ideally, the extension of the tax holiday should be financed by reducing the growth of federal spending.
- There are other tax cuts, such as permanent reductions in marginal income tax rates and/or permanent reductions in the double taxation of saving and investment, that would have a better impact on the economy.
- There are other tax cuts, such as expanded credits, deductions, preferences, exemptions, and shelters, that have no positive impact on the economy.
- A payroll tax holiday does not undermine Social Security since the Trust Fund is nothing but a big pile of IOUs.
- The best incremental reform would be a permanent reduction in the payroll tax, with the money channeled to personal retirement accounts. This would lower the tax burden of work while reducing the long-run burden of entitlement spending.
- This discussion of payroll taxes and incremental reform should not distract us from the enormously important issue of genuinely fixing entitlement programs, something that is needed to save America from Greek-style fiscal collapse at some point in the future.
So what does all this mean? Simply stated, there are many other fiscal reforms that are preferable, but a temporary extension of the payroll tax holiday is better than nothing—assuming, of course, it is not poisoned by accompanying class-warfare tax hikes.
Hillary Clinton Heads to Burma
On Wednesday, Secretary of State Hillary Clinton travels to the isolated nation of Burma, officially known as Myanmar, in an attempt to spur the reform process. “After years of darkness, we’ve seen flickers of progress,” said President Barack Obama of the troubled country. By visiting Burma Secretary Clinton can test the new government’s willingness to do more.
Of course, the Clinton initiative may fail. But the main argument for the policy change is not that it is certain to work, but that the alternative has failed. Isolating Burma has achieved nothing.
Burma long has been one of the most tragic of nations. The military regime brutally suppressed the democracy movement led by Nobel laureate Aung San Suu Kyi. Even more deadly has been the half-century long battle with ethnic groups like the Karen, which have sought autonomy in the east.
The United States and Europe responded with sanctions, but to no avail. China took advantage to secure a position of political influence and economic dominance. The military regime continued to live up to its reputation for brutality and corruption.
Now there are “flickers of progress,” as the president suggested. A badly flawed election last year; a new, nominally civilian government; the release of a few political prisoners; liberty for Ms. Suu Kyi, who also has been meeting with government ministers; and a slight break between Burma and its chief patron, Beijing.
Individually these are but small changes, and the Burmese military has previously offered tantalizing reforms only to reverse course, intensifying its brutal suppression of any opposition. However, the combination of many small steps offers hope that something more real may be happening this time. Even Suu Kyi has expressed optimism, and is preparing to reenter politics—legally.
Equally important is the increasing evidence that Burma wants to balance the influence of its imperious neighbor China. For all of the worries in America about Beijing’s growing clout around the world, the People’s Republic of China is finding out—just as the United States discovered years ago—that friends can be expensive to buy and often don’t stay bought.
Engaging Burma could encourage that state to continue on a more independent course—separate from China. The regime isn’t likely to dump its patron, but any distance between the two would be progress. The PRC’s churlish reaction to the Clinton initiative suggests that Beijing is concerned.
An adjustment in U.S. policy toward Burma was sorely needed. Isolation resulted in few positive outcomes. For the most part Asian nations, even America’s friends, ignored U.S. and European sanctions. The regime did not fall; Suu Kyi was not freed; democracy did not come; the ethnic groups did not enjoy peace. The generals simply tightened their grip.
Although this policy failure long has been obvious, no one wanted to “reward” the Burmese regime by dropping economic penalties. This left U.S. policy stuck in a political cul-de-sac. Sanctions were ineffective, doing nothing to advance human rights. But they could not be changed for the sake of appearance.
Nascent reform in Burma now offers Washington an opportunity to shift course. No one should get their hopes up. The regime may intend to only adopt a few reforms as window-dressing to win Western aid. Even if the commitment to change is real, the road to a better life for the Burmese people remains long and hard.
Nevertheless, for the first time in years there truly are “flickers of progress” in Burma. The administration is right to try to turn these flickers into something more. A desperately poor and oppressed people deserve a better life.
Apparently a Little Economics Education Does Work on Congress….
While most of my adult life has been devoted to simply imparting basic Economics to policymakers, I have to admit to being a little skeptical as to if they are actually listening. I’ve seen too many times, especially during my service as staff in the Senate, politicians support policies they have to know are harmful. So it always encouraging to see some evidence of Congress taking basic Economics into account.
The evidence is presented in a recent paper in the academic journal Public Choice. The paper examines the 2007 vote to raise the minimum wage. After controlling for a variety of factors, the “study finds that members who majored in economics as undergraduates were less likely to vote for the minimum wage increase than their colleagues.” Again this controls for party and others factors that might also influence a Representative’s decision. As you probably recall, the vote in question did pass. So while I’m not suggesting that a few more economists in Congress would solve all our problems, it might actually help.
Little Evidence for Either
No Child Left Behind (NCLB) or Common Core? NCLB and Common Core? If you look at the evidence, the answer to both questions is “no.” There’s precious little evidence that NCLB has worked, and just as little that national standards will do any better.
Despite all the fine sounding talk about the federal government demanding “accountability” and forcing states to improve, NAEP data for long-struggling groups reveals many periods before NCLB with equal or faster score gains than under No Child. In other words, the federal government’s own measure of academic achievement provides no support for the idea that accountability – or anything else under No Child – has translated into better performance.
But hasn’t the problem been the lack of a common measure of “proficiency,” which has allowed states to dodge the hard work of getting all kids up to speed? And isn’t that precisely what the Common Core will fix?
No again. What we’ve learned from not just NCLB, but decades of failed federal education intervention, is that politicians and administrators at all levels will find ways to take federal money while avoiding meaningful consequences for poor performance. And there’s little reason to believe that the Common Core will change that.
For one thing, if the Common Core truly is controlled by states – which, given the Race to the Top, waivers, and federal funding of national tests it clearly isn’t – then states will ignore the standards whenever they’re inconvenient. And if the federal government tries to put the screws to states that underperform? All the teachers’ unions, administrators’ associations, and other groups representing those who would be held accountable will mobilize and have the system gutted. It’s the clear lesson of history.
But isn’t the Common Core so good, and having national standards so important, that we must adopt them?
Yet again, no.
There’s essentially no meaningful evidence that, other things being equal, countries with national standards perform better than those without. And there is serious disagreement over the quality of the Common Core, including powerful critiques from well known English language arts expert Sandra Stotsky, and the only mathematician on the Common Core Validation Committee, R. James Milgram.
Common Core, No Child Left Behind – both are cut from the same, moth-devoured cloth: top-down government control. In light of decades of costly failure, it is well past time we stop entertaining such fixes and move on to something different. It’s time to focus on fundamentally changing the system so that educators have the freedom to tailor teaching to the needs of unique children, while parents are empowered to hold educators truly accountable. It is time for school choice, which, unlike NCLB and national standards, the evidence very much supports.
C/P from the National Journal’s “Education Experts” blog.
Idiosyncrasy in the New York Times
Webster’s defines “idiosyncrasy” as “a peculiarity of constitution or temperament” or “characteristic peculiarity (as of temperament); broadly: eccentricity.”
And what does the New York Times define as an idiosyncrasy? A headline this weekend tells us that
Idiosyncrasy Runs Deep in the Soil of Wyoming
And what’s this idiosyncrasy? Cowboy poetry? Jackalopes? Being the first state to grant women the vote?
No, here’s what the Times finds idiosyncratic:
Wyoming’s way — always idiosyncratic in the windblown, rural grain that mixes mind-your-own-business cowboy libertarianism and fiscal penny-pinching — is getting its moment in the spotlight.
Yep, what the New York Times finds idiosyncratic in a nation formed to guarantee the inalienable rights of life, liberty, and pursuit of happiness is a libertarian spirit combined with fiscal conservatism.
It’s not clear that Wyoming lives up to this picture: The Cato Institute’s Fiscal Policy Report Card on America’s Governors noted in 2006 that Wyoming’s budget had risen 60 percent in less than four years. And the Mercatus Center report “Freedom in the 50 States” put Wyoming barely above the national median for both personal and economic freedom. But the libertarian instincts are there, as Jason Sorens and I found in calculations of voter attitudes in the states.
So let’s hear it for “mind-your-own-business cowboy libertarianism and fiscal penny-pinching” — may it spread beyond the four corners of idiosyncratic Wyoming.
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