Archive for the ‘Cato Publications’ Category
Tuesday Links
- In the Obama era, the “slippery slope” has gone vertical: “Instead of ‘eventually,’ the feared extensions of government power come immediately.”
- The House health care bill: “One of the most expensive pieces of legislation in history.”
- How quickly we forget: “In spite of its monumental failure to bring social peace and material abundance, socialism is enjoying something of a renaissance.“
- Good question: Why would Congress compel young adults to buy health insurance they don’t need?
- Podcast: The Cost of the Health Care Bill
A Plug for Financial Fiasco
The distinguished Harvard economist Richard N. Cooper, former president of the Federal Reserve Bank of Boston, praises Johan Norberg’s Financial Fiasco: How America’s Infatuation With Homeownership and Easy Money Created the Economic Crisis in Foreign Affairs:
The economic crisis of 2008-9 will no doubt spawn dozens of books. Here are two good early ones….
Norberg, a knowledgeable Swede, provides a much more detailed account of the broader events of 2007-9, from the useful perspective of a non-American. He finds plenty of blame with all the major players in the U.S. financial system: politicians, who thoughtlessly pushed homeownership on thousands who could not afford it; mortgage loan originators, who relaxed credit standards; securitizers, who packaged poor-quality mortgage loans as though these were conventional loans; the Securities and Exchange Commission, which endowed the leading rating agencies with oligopoly powers; the rating agencies, which knowingly overrated securitized mortgages and their derivatives; and investors, who let the ratings substitute for due diligence. Senior management in large parts of the financial community lacked an attribute essential to any well-functioning financial market: integrity. But solutions, Norberg warns, do not lie in greater regulation or public ownership. Politicians and bureaucrats are not immune from the “short-termism” that plagues private firms.
The other book he praises, by the way, is Paul Krugman’s The Return of Depression Economics. And oddly, his list of Norberg’s villains doesn’t include one implied in the title: the Federal Reserve Bank, which issued the “easy money” that allowed the boom to happen. Purchase Financial Fiasco here or on Kindle.
Filed under: Cato Publications; Finance, Banking & Monetary Policy
Monday Links
- Today marks 20 years since the fall of the Berlin Wall. Full round-up of commentary on that historic day, here.
- The heroes who helped bring down the Wall.
- One size does not fit all: How the federal health care overhaul will disrupt progress in states that are already addressing problems at home.
- Move over Fox News: The Obama administration takes aim at climate scientists.
- Podcast: “ObamaCare: A Bad Deal for Young Adults“
Weekend Links
- The Democrats’ ingenious plan to disguise the true cost of their health care bills.
- The health care legislation moving through Congress could increase young adults’ premiums by 100 percent.
- Why raising taxes won’t fix the deficit. Just look at California. And Rhode Island. And New York.
- “What profiteth a political party if it gains congressional seats but loseth its soul?” —Michael D. Tanner (Yes, he’s referring to Republicans.)
- Here we go again: The No Child Left Behind Act is up for renewal.
- Podcast: “Ayn Rand’s Affinities and Animosities“
Wednesday Links
- Drop the neocons: “Republicans should take this opportunity to return to their traditional noninterventionist roots and throw their neoconservative wing under the bus.”
- John Samples on the national impact of this week’s elections: “The evidence suggests the Obama administration might be on the same path that led the Clinton presidency to the election of 1994. But there is an important difference: In 1994, the public had some faith in the alternative to Clinton and the Democrats in Congress.”
- Podcast: “Independents and the GOP Victories“
Report to DoD: Data Mining Won’t Catch Terrorism
Via Secrecy News, “JASON”—a unit of defense contractor the MITRE Corporation—has reported to the Department of Defense on the weakness of data mining for predicting or discovering inchoate terrorist attacks.
“[I]t is simply not possible to validate (evaluate) predictive models of rare events that have not occurred, and unvalidated models cannot be relied upon,” says the report.
In December 2006, Jeff Jonas and I published a paper making the case that predictive modeling won’t discover rare events like terrorism. The paper, Effective Counterterrorism and the Limited Role of Predictive Data Mining, was featured prominently in a Senate Judiciary Committee hearing early the next year.
Privacy gives way to appropriate security measures, as the Fourth Amendment suggests where it approves “reasonable” searches and seizures. Given the incapacity of data mining to catch terrorism and the massive data collection required to “mine” for terrorism, data mining for terrorism is a wrongful invasion of Americans’ privacy—and a waste of time.
Filed under: Cato Publications; Foreign Policy and National Security; Telecom, Internet & Information Policy
Tuesday Links
- Three cheers for divided government: “Since the start of the Cold War, we’ve had only a dozen years of real fiscal restraint” …And all of them occurred when the White House and Congress were held by opposite parties.
- Well here’s an idea: Only pay for health care that works.
- The case against tort reform in health care.
- Video: The authors of two new Ayn Rand biographies discuss their work and research.
- Podcast: “Ayn Rand and the World She Made“
Libertarian Movement — Just Too Big and Too Busy?
Last night — a Monday night, the eve of a hotly contested gubernatorial election in Virginia — there were at least three interesting events for libertarians in the Washington area:
- Reason.tv held an event to launch “Radicals for Capitalism,” a new series of videos celebrating Ayn Rand’s continuing influence.
- The Future of Freedom Foundation and the George Mason University Economics Society sponsored a lecture by Lawrence W. Reed, president of the Foundation for Economic Education, at GMU.
- And here at the Cato Institute, an overflow crowd gathered to watch a new film, The Soviet Story, which the Economist called “the most powerful antidote yet to the sanitisation of the past.”
It’s got to be a sign of growth and health if the libertarian movement is offering three excellent programs on one Monday night in one area. But what’s an overscheduled libertarian to do?
Filed under: Cato Publications; General; Political Philosophy
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.
Is the Economy Booming Again?
The lead headline in Friday’s Wall Street Journal proclaims
Economy Snaps Long Slump
But buried on page C10 is a more skeptical view:
If the Obama administration were managing a company, it might have hoped the latest gross-domestic-product numbers would be greeted with cries of “great quarter, guys!”
At least the stock-market obliged, rising on the back of better-than-expected GDP data Thursday morning. But then bulls have become used to looking to Washington for inspiration. Zero rates and stimulus programs boost economic data as well as nudge money toward riskier assets.
Fully 2.2 percentage points of the third quarter’s 3.5% growth figure related to vehicle purchases and residential construction, both juiced by government support. Federal spending added 0.6%.
If these GDP data were company earnings, they would be what analysts euphemistically call “low quality.” Investors buying into the market off the back of them are ignoring weekly unemployment-claims data that came in above 500,000 again on the same day.
The danger is that all these short-term fixes leave the economy dangerously addicted to taxpayer-funded steroids. The circularity in the housing market, whereby Washington provides tax breaks to first-time buyers, guarantees most of the mortgages written, and then buys most of those, beggars belief, and suggests a worrying case of amnesia following the bursting of the housing bubble. (emphasis added)
Johan Norberg warned about the dangers of repeating the very mistakes that created the bubble and bust in the first place in Financial Fiasco: How America’s Infatuation with Homeownership and Easy Money Created the Economic Crisis (available in hardcover, e-book, or Kindle).
Filed under: Cato Publications; Finance, Banking & Monetary Policy
Our Libertarian Future
Brink Lindsey described a “libertarian consensus that mixes the social freedom of the left with the economic freedom of the right” in his book The Age of Abundance. Matt Welch and Nick Gillespie said that right now is a “libertarian moment.” I saw a “civil liberties surge” in public opinion polls on marijuana laws and gay marriage. And now Jacob Weisberg foresees the imminent end to various kinds of prohibition in these United States:
Within 10 years, it seems a reasonable guess that Americans will travel freely to Cuba, that all states will recognize gay unions, and that few will retain criminal penalties for marijuana use by individuals. Whether or not Democrats retain control of Congress, whether or not Obama is re-elected, and whether they happen sooner or later than expected, these reforms are inevitable—not because politics has changed but because society has.
For good measure, he adds that we’re not going to prohibit either abortion or gun ownership. “Conservatives would be wise to give up on the one, liberals on the other. In each of these cases, popular demand for an individual right is simply too powerful to overcome.”
Sounds like libertarian heaven:
The chief reason these prohibitions are falling away is the evolving definition of the pursuit of happiness….
Republicans face a risk in resisting these new realities. Freedom is part of their brand; if the GOP remains the party of prohibition, it will increasingly alienate libertarian-leaners and the young. But the party as presently constituted has very little capacity to accept social change. Democrats face a danger in embracing cultural transformations too eagerly. Nearly four decades after George McGovern became known as the candidate of amnesty, abortion, and acid, cultural issues are still treacherous territory for them. Why get in front of change when you can follow from a safe distance and end up with the same result?
Of course, if the Democrats raise taxes and the deficit high enough, and do what they’re threatening to do to health care, marijuana may be the only medicine you don’t have to get on a waiting list for, but you won’t be able to afford it. And the marriage penalty may make everyone decide they can’t afford to get married. And flights to Cuba may be too expensive on our dwindling after-tax incomes.
Filed under: Cato Publications; General; Government and Politics; Political Philosophy
Weekend Links
- “Government should not subsidize health insurance — for the uninsured, the poor, the elderly or anyone else — or regulate health insurance markets.” Here’s why.
- This is what happens to health care when you are not the customer.
- An update on the EU Lisbon Treaty.
- Why Fannie and Freddie mustn’t be left out of reform efforts.
- Skepticism over nuclear diplomacy with Iran. (PDF) Subscribe to the Nuclear Proliferation Update here.
- Podcast: “Obama: Kinder Bud to Federalism?” featuring Aaron Houston of the Marijuana Policy Project.
Wisdom of the Anti-Federalists
Everybody reads the Federalist Papers. (I hope!) Written by Alexander Hamilton, James Madison, and John Jay, they are generally regarded as the most profound collection of political theory ever written in America. And since they deeply inform our understanding of our fundamental law, they are essential to understanding the American version of limited, constitutional government. But the ratification of the Constitution was a close thing in 1787–89, and the Anti-Federalists (who said that actually they were the federalists, while their opponents were nationalists) also had some insightful things to say about liberty and limited government.
Now the invaluable Liberty Fund has made available a collection of anti-federalist writings, The Anti-Federalist Writings of the Melancton Smith Circle. The publisher says:
The Anti-Federalist Writings of the Melancton Smith Circle makes available for the first time a one-volume collection of Anti-Federalist writings that are commensurate in scope, significance, political brilliance, and depth with those in The Federalist. Included in this volume as an appendix is a computational and contextual analysis that addresses the question of the authorship of two of the most well-known pseudonymous Anti-Federalist writings, namely, Essays of a Federal Farmer and Essays of Brutus. Also included are the records of Smith’s important speeches at the New York Ratifying Convention, some shorter writings of Smith’s from the ratification debate, and a set of private letters Smith wrote on constitutional subjects at the time of the ratification struggle.
One reason it’s important to study the ideas of the Anti-Federalists was offered by Jeffrey Rogers Hummel in The Encyclopedia of Libertarianism:
Most of the Amendments comprising the Bill of Rights restricted the national government’s direct authority over its citizens. Only one section dealt with the relationship between the state and central governments; the 10th Amendment “reserved” to the states or the people all powers not “delegated to the United States by the Constitution.” Nothing better illustrates that, whereas the Anti-Federalists had lost on the ratification issue, they had won on the question of how the Constitution would operate. The Constitution had not established a consolidated national system of government as most Federalists had at first intended, but a truly federal system, which is what the Anti-Federalists had wanted. In simpler terms, the Federalists got their Constitution, but the Anti-Federalists determined how it would be interpreted.
In a world where it’s easy to find a “Dirty Dozen” of Supreme Court decisions that have expanded government and eroded freedom, that may be hard to believe. But it’s important to read both halves of early American debate over the Constitution in order to understand the foundations of our system.
Filed under: Cato Publications; Law and Civil Liberties; Political Philosophy
VOIP News: Cato Is Tops! But Let’s Clarify Something
Though I hadn’t heard of it before, I was delighted to see a publication called VOIP News cite the Cato Institute as one of 15 “Greatest Enemies of Net Neutrality.” As VOIP News says, we are indeed a “voice of reason during political debates.”
Alas, I’m selectively quoting. What they actually said, snidely, was that Cato is a “hired voice of reason during political debates, because of its pseudo-academic affiliations.” (I don’t know why they italicized “voice of reason” – I always thought Reason was the voice of reason.)
But my selective quotation is as accurate as the selective research that VOIP News did for this fluffy hit piece. You see, Cato recently published a lengthy paper that articulates the benefits of net neutrality (referred to as the end-to-end principle).
Where do you find that in the paper? Here’s the first paragraph of the executive summary:
An important reason for the Internet’s remarkable growth over the last quarter century is the “end-to-end” principle that networks should confine themselves to transmitting generic packets without worrying about their contents. Not only has this made deployment of internet infrastructure cheap and efficient, but it has created fertile ground for entrepreneurship. On a network that respects the end-to-end principle, prior approval from network owners is not needed to launch new applications, services, or content.
The paper expresses well-founded concerns about net neutrality regulation—taking a good engineering practice and making a mandate of it for lawyers and bureaucrats to implement. From the executive summary’s third paragraph:
New regulations inevitably come with unintended consequences. Indeed, today’s network neutrality debate is strikingly similar to the debate that produced the first modern regulatory agency, the Interstate Commerce Commission. Unfortunately, rather than protecting consumers from the railroads, the ICC protected the railroads from competition by erecting new barriers to entry in the surface transportation marketplace. Other 20th-century regulatory agencies also limited competition in the industries they regulated. Like these older regulatory regimes, network neutrality regulations are likely not to achieve their intended aims.
It’s tough sledding, working through most of a one-page executive summary. But many publications go that far in researching the pieces they publish.
I do sincerely appreciate the nod to our prominence in this debate. I hope VOIP News does a better job of portraying where we stand and why in the future.
Filed under: Cato Publications; Telecom, Internet & Information Policy
Thursday Links
- A Financial Super-Regulator: The dangers of giving the Fed too much power.
- The financial regulators’ pipe dream: “Most new regulation will do nothing to limit crises because markets will innovate around it. Worse, some regulation being considered by Congress will guarantee bigger and more frequent crises.”
- The shape of things to come? More war will come before peace in the Middle East, says journalist and foreign affairs analyst Leon Hadar.
- The illegal cigarette trade in Ireland reaches “epidemic proportions“ after the government imposes draconian regulations on tobacco products.
- Podcast: “Too Big to Fail Is Just Too Big“
Wednesday Links
- How Washington’s plans may result in even higher executive pay.
“In 1993, Congress intervened in corporate compensation and messed things up. Now it’s the White House’s turn.”
- The case for allowing insider trading: “Want to keep companies honest, make the markets work more efficiently and encourage investors to diversify? Let insiders buy and sell.”
- Cato v. Heritage on the Patriot Act, Round III: “In hindsight, did Congress and the president react too hastily in 2001 by passing the Patriot Act just weeks after the 9/11 attacks?”
- Instead of fixing the Patriot Act, President Obama is protecting it.
- Twenty years later: Why the Berlin Wall fell.
- Podcast: “Financial Privacy and Freedom” featuring Prince Michael of Liechtenstein.
The Church of Global Warming
Novelist Michael Crichton said that environmentalism had all the trappings of a religion: “Eden, the fall of man, the loss of grace, the coming doomsday.” I never took such claims entirely seriously. But then I heard this statement from a Montana writer, Jim Robbins, interviewed by the “sustainability reporters” of government-funded Marketplace Radio:
There’s a saying that there are no atheists in foxholes. I think there’s something along that line happening here. I mean, there are still some people who refuse to believe it. But I think there’s been an erosion of that disbelief and it’s changed pretty dramatically.
Darned if he isn’t using terms like “atheists” and “disbelief” in a discussion of global warming. Almost as if he were, you know, a theologian.
Reporter Sarah Gardner, by the way, says that “in my own lifetime, average temperatures in this country have gone up more than 2 degrees.” That doesn’t sound like that much — maybe like moving from Washington to Richmond? But anyway, unless Sarah is about 200 years old, she seems to be exaggerating.
For a different view of global warming — not that of an atheist or even a skeptic, just a non-fundamentalist or non-apocalyptic — see this short paper or this book by climatologist Pat Michaels.
Tuesday Links
- Dear members of Congress: If you’re not going to read the bills you pass, at least read the Constitution. Don’t fret; it’s short and written in plain English.
- Richard Rahn: Pay members of Congress more. (Or less, depending on their performance.)
- NYC: “The city that never smokes.” A proposal to ban lighting up in New York’s parks has exposed the puritanical agenda behind the crusade against smoking.
- Tyler Cowen: With health care costs high and rising, government mandates to buy insurance would make many people worse off.
- Podcast: “Pay Czar Cuts Checks“
Gallup’s Conservatives and Libertarians
In today’s Washington Post, William Kristol exults:
The Gallup poll released Monday shows the public’s conservatism at a high-water mark. Some 40 percent of Americans call themselves conservative, compared with 36 percent who self-describe as moderates and 20 percent as liberals.
Gallup often asks people how they describe themselves. But sometimes they classify people according to the values they express. And when they do that, they find a healthy percentage of libertarians, as well as an unfortunate number of big-government “populists.”
For more than a dozen years now, the Gallup Poll has been using two questions to categorize respondents by ideology:
- Some people think the government is trying to do too many things that should be left to individuals and businesses. Others think that government should do more to solve our country’s problems. Which comes closer to your own view?
- Some people think the government should promote traditional values in our society. Others think the government should not favor any particular set of values. Which comes closer to your own view?
Combining the responses to those two questions, Gallup found the ideological breakdown of the public shown below. With these two broad questions, Gallup consistently finds about 20 percent of respondents to be libertarian.
The word “libertarian” isn’t well known, so pollsters don’t find many people claiming to be libertarian. And usually they don’t ask. But a large portion of Americans hold generally libertarian views — views that might be described as fiscally conservative and socially liberal, or as Gov. William Weld told the 1992 Republican National Convention, “I want the government out of your pocketbook and out of your bedroom.” They don’t fit the red-blue paradigm, and they have their doubts about both conservative Republicans and liberal Democrats. They’re potentially a swing vote in elections. Background on the libertarian vote here.
And note here: If you tell people that “libertarian” means “fiscally conservative and socially liberal,” 44 percent will accept the label.
Filed under: Cato Publications; General; Government and Politics; Political Philosophy
Reid’s Accomplishment
Including a Fannie Med with a “state opt-out” provision in the Senate Democrats’ health care bill accomplishes only this: it helps Majority Leader Harry Reid (D-NV) survive as majority leader by appeasing his left wing. It doesn’t make it any more (or less) likely that Fannie Med will survive.
(Cross-posted at Politico’s Health Care Arena.)
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