Recent Policy Studies

• Retirement/Social Security
  

  Pensions in Peril: Are State Officials Risking Public Employee Retirement Benefits by Playing Global Warming Politics?

  By Steven J. Milloy, Thomas Borelli, National Center for Public Policy Research
  
  National Policy Analysis, 09/26/2008
  

  We conclude that state and local pension fund administrators who promote or ignore global warming regulation may be contributing to undesirable economic conditions that will adversely impact the portfolios they manage. Moreover, pension administrators who are promoting global warming regulation appear to be doing so for partisan political purposes. This could be considered a breach of their fiduciary responsibility. We recommend that, unless global warming regulation can be justified as a significant benefit to the broad economy and stock market, state and local pension fund administrators actively oppose it.

  
  
  
• Information Technology
  

  Online Advertising & User Privacy: Principles to Guide the Debate

  By Berin Szoka, Adam Thierer, Progress & Freedom Foundation
  
  Progress Snapshot, 09/26/2008
  

  “Targeted online advertising” is an ominous-sounding shorthand for the customization of Internet ads to match the interests of users. Not only are these ads more relevant and therefore less annoying to Internet users, they are more cost-effective to advertisers and more profitable to websites that sell ad space. While such “smarter” online advertising scares some—prompting comparisons to a corporate “Big Brother” spying on Internet users—it is also expected to fuel the rapid growth of Internet advertising revenues. Since this growing revenue stream ultimately funds the Internet’s free content and services, policymakers should think very carefully about what’s really best for consumers before rushing to regulate an industry that has thrived for over a decade under a layered approach that combines technological “self-help” by privacy-wary consumers, consumer education, industry self-regulation, existing state privacy tort laws, and Federal Trade Commission enforcement of corporate privacy policies.

  
  
  
• Information Technology
  

  FCC Reform: Scalpel or Steamroller?

  By Barbara S. Esbin, Progress & Freedom Foundation
  
  Progress on Point, 09/26/2008
  

  In late July, 2008, House Commerce Committee Ranking Member Joe Barton (R-Texas), circulated as a discussion draft a bill to force the Federal Communications Commission ( FCC) to act more openly, entitled the “FCC Procedural Reform for Openness and Clarity Encouraging Sensible Solutions Act” or the “FCC PROCESS Act.” Representative Barton’s commendable effort to “improve public participation and overall decision-making at the Federal Communications Commission” is a useful first step towards FCC reform. The narrow focus of the discussion draft raises a broader question of whether it is desirable to apply a “scalpel” and reform only FCC processes or employ a “steamroller” to remake both the agency and its authorizing statute, the Communications Act of 1934, as amended (the Act or the ‘34 Act). It is high time to begin the debate on reforming our current approach to communications regulation and the agency charged with its implementation.

  
  
  
• Budget & Taxation
  

  Lessons from the $388-Million Hyatt Case: How Current Tax Policy Hurts California, and How the State Can Fix Its Revenue Problem

  By K. Lloyd Billingsley, Pacific Research Institute
  
  Capital Ideas, 09/26/2008
  

  California’s financial problems may have gotten worse by $388 million, according to an August 16 Nevada trial verdict in favor of an inventor mistreated by California’s Franchise Tax Board. Gilbert P. Hyatt, secured a patent on an invention in 1990 and contends that he moved to Nevada, which has no state income tax, before the invention began paying off in the multi-millions. California’s Franchise Tax Board (FTB) charged that Mr. Hyatt was still a California resident at the time, and subject to state income tax. The Hyatt case has already cost the FTB nearly $9 million, according to news reports. Given the FTB’s track record, settling with Mr. Hyatt might be the wisest course of action. It would be wiser still for the state to discard the current income tax system, which is punitive and unstable. Better to implement a flat income tax that would treat all Californians fairly and equally, and tame the state’s revenue rollercoaster.

  
  
  
• Health Care
  

  California Budget Has Not Solved the Medi-Cal Crisis

  By John R. Graham, Pacific Research Institute
  
  Capital Ideas, 09/26/2008
  

  Three months late, governor Schwarzenegger has finally signed a budget that holds spending down to $103 billion. Unfortunately, the governor and legislators missed the chance to wrangle Medi-Cal, the state’s Medicaid program, under control. Medi-Cal is a big part of the state’s deficit problem. It’s the second largest chunk of the general fund, after K-12 education. Despite years of out-of-control spending, Medi-Cal still fails both providers and patients. At its core, the problem is not a budgetary crisis: it’s a crisis of government dependency.

  
  
  
• Regulation & Deregulation
  

  Testimony of Marlo Lews on Greenhouse Gas Regulation Under the Clean Air Act

  By Marlo Lewis, Competitive Enterprise Institute
  
  Testimony, 09/26/2008
  

  The Clean Air Act is a flawed, unsuitable, and potentially destructive instrument for reducing greenhouse gas emissions. As EPA’s July 2008 Advanced Notice of Proposed Rulemaking documents, because of the Act’s multiple interconnections, setting greenhouse gas emission standards for new motor vehicles under Section 202 could trigger massive, economy-chilling regulation under the New Source Review/Prevention of Significant Deterioration and National Ambient Air Quality Standards programs. It is inconceivable that those who drafted and enacted the Clean Air Act intended for it to undermine the economy and jeopardize environmental enforcement. Yet economic devastation and administrative paralysis are real risks if EPA attempts to pound the square peg of climate policy into the round hole of the Clean Air Act.

  
  
  
• Monetary Policy/Financial Regulation
  

  Facts About the AIG Collapse: A Response to the NAIC

  By Eli Lehrer, Competitive Enterprise Institute
  
  WebMemo, 09/26/2008
  

  Following the collapse of insurance industry giant American International Group (AIG), the National Association of Insurance Commissioners (NAIC) issued a statement—quoting NAIC president Sandy Praeger—urging that the “conversation should stay focused on the facts.” This is a laudable purpose. In its released statement, NAIC takes two major insurance trade associations to task for bringing forward the idea that the AIG collapse justifies the idea of an Optional Federal Charter. NAIC makes a valid point: AIG’s collapse does not prove that the United States needs federal oversight of insurance and there’s no way to know for certain if a federal charter would have done anything to prevent the insurance company’s collapse. Nonetheless, remaining focused on the facts requires an appreciation of those facts. And NAIC, in many cases, tells only part of the story.

  
  
  
• Foreign Policy/International Affairs
  

  President Bush’s Farewell to the U.N.: A Call for Reform and Action

  By Brett D. Schaefer, The Heritage Foundation
  
  WebMemo, 09/26/2008
  

  President George W. Bush’s final address to the United Nations was, in many ways, an encapsulation of America’s primary objectives in the U.N over the past eight years. Several issues were featured prominently in the speech, including: an appeal for the organization and the member states to more forcefully confront terrorism; a demand for more action by the U.N. and the member states on human rights; an exhortation for the President’s freedom agenda accompanied by justifications for why representative government bolsters international peace and stability; and a call for the organization to implement reforms. As is typical for these speeches, details were largely absent. The responsibility now falls to the State Department and the U.S. Mission to the United Nations to follow through and see that the United Nations moves forward on the President’s agenda.

  
  
  
• Foreign Policy/International Affairs
  

  Under Aso, Prospects Bright for U.S.-Japan Strategic Relationship, but Challenges Remain

  By Bruce Klingner, The Heritage Foundation
  
  WebMemo, 09/26/2008
  

  On September 24, Taro Aso became the new Japanese prime minister and the country’s fourth ruler in three years. Aso’s foreign policy views are more in line with the United States than those of his predecessor, Yasuo Fukuda; that is a welcome development. Depending greatly on how politics in Japan shake out in the next couple months, Aso’s election offers the hope of closer coordination on U.S.-Japanese strategic interests. Japan's structural constraints and unwillingness to generate decisive leadership may doom it to mediocrity. A fundamental question for Washington, including the next U.S. president, will be how to respond to Japan’s tendency for slow, incremental changes. The U.S. options will be to accept the status quo, push harder for quicker alliance transformation, or look elsewhere for more reliable allies, such as South Korea. For the sake of the U.S. position in the region and the United States-Japanese relationship, transformation is the far preferable choice.

  
  
  
• Monetary Policy/Financial Regulation
  

  All Deliberate Speed: Constitutional Fidelity and Prudent Policy Go Hand in Hand in Fixing the Credit Crisis

  By Todd F. Gaziano, Andrew M. Grossman, The Heritage Foundation
  
  WebMemo, 09/26/2008
  

  Even in times of difficulty or crisis, the constitutional design for legislation requires careful, bicameral deliberation and presentment to the President. For sound policy and constitutional reasons, Congress should not recess until it acts on a solution to the credit crisis, but it should also be mindful of the virtues of calm deliberation and the dangers to liberty of a crisis mentality. The mounting resistance to the Administration’s proposal presents an opportunity for careful deliberation. The constitutional and policy concerns expressed by many Members of Congress and thoughtful scholars this past week must be thoroughly considered.

  
  
  
• National Security
  

  Europe, Missile Defense, and the Future of Extended Deterrence

  By Baker Spring, The Heritage Foundation
  
  WebMemo, 09/26/2008
  

  During the Cold War, the U.S. supported the security of its allies by threatening a possible nuclear response to an attack on them by the Soviet Union. This policy, which was based on retaliatory threats, was referred to as “extended deterrence.” Today, the policy of extended deterrence is no less important to overall U.S. security than during the Cold War. Congress should seek to accelerate the trend toward an extended deterrence policy that relies on a more defensive military posture in the alliance. It should also instruct the next Administration to explore selective bilateral security ties with European North Atlantic Treaty Organization members that augment and reinforce the existing multilateral security commitments. Such actions will result in U.S.-European security structure that is better adapted to meeting the challenges of the multi-polar world.

  
  
  
• Budget & Taxation
  

  New Census Data on Property Taxes on Homeowners

  By Gerald Prante, Tax Foundation
  
  Fiscal Facts, 09/26/2008
  

  The Census Bureau has released new housing numbers courtesy of the 2007 American Community Survey, which includes real estate taxes paid on owner-occupied housing units. Data is included for many geographical units, including states and high-population counties. The Northeast, mainly New Jersey and New York, remains the area with the highest property taxes on homeowners. These states also have high per capita income, and the highest property tax bills, in terms of dollar amounts, are usually found in the areas with the highest incomes. As for the percentage-of-home-value measure, counties in New Jersey and New York still dominate as they tend to impose the highest property tax rates on homeowners as well.

  
  
  
• Economic Growth
  

  Hudson Institute Economic Report

  By Diana Furchtgott-Roth, Hudson Institute
  
  Hudson Institute Economic Report, 09/26/2008
  

  The Consumer Price Index decreased – 0.1 percent in August – for the first time since October 2006. This fall in inflation is due to the decrease in index for energy (-3.1 percent), transportation (-1.5 percent) and housing (-0.1 percent). The core CPI increased 0.2 percent in August and 2.6 percent over the past year. Housing construction activity declined in August, once again largely because of a sharp drop in multifamily permits and starts. Total starts decreased by 6.2 percent from July, with single-family starts down by 1.9 percent and multifamily starts by 16.8 percent. None of these monthly declines are statistically significant, but both single-family starts at 630,000 and total starts at 895,000 were at their lowest levels since January 1991.

  
  
  
• Economic Growth
  

  Revitalizing African Agriculture

  By Mike Norton-Griffiths, PERC – The Property and Environment Research Center
  
  PERC Reports, 09/25/2008
  

  In Kenya there are abundant data showing the striking gains to be made in economic productivity and environmental management on land farmed under secure property rights. Africa is littered with the failed efforts of governments to impose state control over land allocation and land use, while the rural poverty over vast tracts of Africa serves as testimony to the price those still blighted by customary tenure regimes are expected to pay. Weak tenure regimes under centralized control are naturally favored by political and economic elites as they enable takings. As Kenya demonstrates so clearly, people do what they do in response to economic incentives, but their ability to respond efficiently depends on the security of their property rights.

  
  
  
• The Constitution/Civil Liberties
  

  Conatser v. Johnson Threatens Stream Banks and Property Rights

  By Reed Watson , PERC – The Property and Environment Research Center
  
  PERC Reports, 09/25/2008
  

  On July 18, Kevin Conatser became the poster child for trespassing fishermen everywhere. He earned that reputation when the Utah Supreme Court ruled that public ownership of state waters gave him—and every other Utah resident—the right to stand, wade, and fish on the privately owned stream beds beneath those waters. Touted as a coup for access-minded environmentalists, the ruling erodes private property rights and threatens the health of Utah’s fisheries and streams. A far better solution would have been to allocate full property rights over the beds, banks, and water to private landowners along non-navigable water ways. If these landowners could charge recreation fees, their economic incentives to manage the resource would match the public’s interest in healthy streams.

  
  
  
• Natural Resources, Energy, Environment, & Science
  

  Growing Green in China

  By Jeff Bennet, PERC – The Property and Environment Research Center
  
  PERC Reports, 09/25/2008
  

  In 1999 the Chinese Government instituted the Conversion of Cropland to Forest and Grassland Program in an attempt to stabilize the soils of highly erodable areas. Under the program—often called the Grain for Green Program—farmers are paid a combination of cash and grain to plant tree seedlings or perennial grasses (provided free) on previously cropped or barren land. The program has been enthusiastically embraced, and the alternative land uses offered better livelihoods to farmers. Two stumbling blocks had kept them from adopting these practices earlier: the startup cost, and the weak definition and defense of the property rights held by farmers, making them fearful to make any long-term endeavors. If Chinese Government institutes property rights, spending on the Grain for Green Program will be reduced while more environmental protection will be achieved.

  
  
  
• Natural Resources, Energy, Environment, & Science
  

  Markets for Water Quality

  By Bruce Yandle, PERC – The Property and Environment Research Center
  
  PERC Reports, 09/25/2008
  

  In the late 1990s, the U.S. Environmental Protection Agency (EPA) began encouraging the use of market forces to improve water quality in rivers, streams, and coastal waters. The EPA realized that the command-and-control, point-source regulations prescribed by the Clean Water Act were not working. Three different approaches in Pennsylvania, Connecticut, and North Carolina illustrated what can happen when states are given flexibility in achieving environmental goals. In each case, market incentives have been used to induce cooperation, innovation, and accountability. These experiments did not always come easy. Sometimes regulators looked the other way to encourage experimentation. By taking on risk, the regulatory authorities helped deliver improved institutions for managing water quality. Think what might happen if state and federal legislative bodies provided a process for granting waivers for more controlled experiments where the sponsoring organization would demonstrate the superior potential for alternative approaches for achieving improved water quality.

  
  
  
• Welfare
  

  If You Really Want to Help the Poor, Remember Milton Friedman

  By Randy T. Simmons, PERC – The Property and Environment Research Center
  
  PERC Reports, 09/25/2008
  

  One way Friedman tried to make the world better was by promoting a negative income tax (NIT) that would both help the poor and reduce destructive politics. The NIT would replace all income programs with a simple cash payment to every citizen. Friedman’s negative income tax is based on more than his belief that if the main problem of the poor is that they have too little money, the simplest and cheapest solution is to give them some more. Doing things efficiently is certainly a good thing but letting people make judgments for themselves is even more important. Government, according to Friedman, should not be a dispenser of favors; it should keep its nose out of people’s private lives and out of people’s economic business. The paternalism of rent subsidies, food stamps, etc., violates that view of government.

  
  
  
• Natural Resources, Energy, Environment, & Science
  

  Looking to Increase Your Fuel Costs? Buy Ethanol

  By Brandon Scarborough , PERC – The Property and Environment Research Center
  
  PERC Reports, 09/25/2008
  

  A blend of 85 percent ethanol and 15 percent gasoline comprises E85, a fuel that can be used in increasingly popular flex-fuel vehicles. It appears to be a bargain at the pump, but by volume, ethanol contains less energy than conventional gasoline, which means drivers will need more of it to travel the same distance as with conventional gasoline. Despite the false promises, questionable environmental benefits, cost to taxpayers, and the bilking of consumers, President Bush signed an energy bill in December 2007 requiring a nearly six-fold increase in the use of biofuels (primarily ethanol) by 2022. The mandates are unrealistic at best and will inevitably need to be waived, at least in part. In the interim, automakers will expand production of flex-fuel vehicles, gas stations will install new pumps, and consumers will line up to buy E85 with the false hope of reducing their fuel costs and saving the environment.

  
  
  
• Economic Growth
  

  Competitive States: Texas v. California

  By Donna Arduin, et al., Texas Public Policy Foundation
  
  Report, 09/25/2008
  

  There is no finish line in the interstate economic competition. It is a never-ending struggle requiring states to consistently maintain an advantageous economic environment vis-à-vis other states. States that establish and maintain the most pro-growth economic environment will be the leaders in the interstate economic competition. This is especially true with respect to key economic rivals. One key economic rivalry is the rivalry between Texas and California: the two economic heavyweights of the United States. Both Texas and California have the allure of geography, and the economy in both states has been outperforming the national trends. But, current policies matter for future economic performance. Texas’ superior policies over the past several years are making Texas more resilient to the current economic downturn and will provide powerful tailwinds for the Texas economy going forward. The opposite is true for California.

  
  
  
• Economic Growth
  

  States’ Right—To Mess It Up: What Makes a State Competitive?

  By Arthur B. Laffer, Texas Public Policy Foundation
  
  Thinking Economically, 09/25/2008
  

  Workers and investors are legally free to relocate within the 50 states in order to increase their after-tax earnings. This engenders competition for these individuals—and the tax base they provide—among the state legislatures. Economic theory suggests that a pro-growth, business-friendly state environment attracts talented workers, entrepreneurs, and investment, spurring job creation and booming tax receipts to boot. The empirical evidence backs up this intuitive analysis: on every important criterion, pro-growth states outperform those with hostile business climates. In conclusion, state policies matter!

  
  
  
• Education
  

  Paying for Results: Examining Incentive Pay in Texas Schools

  By Brooke Dollens Terry, Texas Public Policy Foundation
  
  Report, 09/25/2008
  

  Most school districts across the country pay teachers with an outdated teacher salary schedule that rewards all teachers equally regardless of performance. This one-size-fits-all compensation structure limits the flexibility of school board members and superintendents to strategically target resources to meet local needs, attract talent in shortage areas, reward excellent teaching, and improve student achievement. Some school districts are bucking this trend by experimenting with innovative free-market strategies that target its limited resources with differential pay, shortage stipends, signing bonuses, combat pay, and pay-for-performance bonuses. The results, thus far, are promising.

  
  
  
• Education
  

  Scholarships for Special Needs Students

  By Brooke Dollens Terry, Texas Public Policy Foundation
  
  Testimony, 09/25/2008
  

  Consensus is growing around the country that students with special needs require individualized education services that not all traditional public schools are equipped to provide. In 1999, the state of Florida passed the McKay Scholarship Program for Students with Disabilities. The scholarships allow children with special needs and their parents to choose the school that best meets their educational needs including public or private schools. The McKay program is the largest program in the country offering choice to students with special needs. Research on the McKay scholarships by the Manhattan Institute found extraordinarily high parental satisfaction, reduction in student behavior problems and harassment, and improvement in academic performance.

  
  
  
• Education
  

  Teacher Performance Pay Is a Good Option for Maine

  By Georgia Geis, Heartland Institute
  
  Report, 09/25/2008
  

  As school districts nationwide experiment with new systems for paying teachers, a new study by the Maine Heritage Policy Center suggests the Pine Tree State should abandon its traditional payment system in favor of performance-based compensation. Recently in Colorado, a four-year pilot study has resulted in the Denver Public Schools’ ProComp model, which has many components, including professional evaluations done by trained teachers and administrators; pay for performance tied to students’ test scores, attendance, and yearly improvement; and incentives for teachers to take jobs in high-need subjects and tough schools. The Denver program found “significant learning gains” among students of participating teachers. Since the model was implemented in 2005, the number of teachers applying for jobs in Denver’s most challenging schools has multiplied eightfold. Currently, many small school districts throughout Maine are being consolidated, and this would be a good time for the state to implement performance-based teacher pay.

  
  
  
• Economic and Political Thought
  

  Federalist Government in Principle and Practice

  By Thomas R. Dye, et al., Public Interest Institute
  
  Book, 09/25/2008
  

  Edited by Dr. Donald P. Racheter, President of Public Interest Institute, and Dr. Richard E. Wagner, Economics Professor at George Mason University and Chairman of the Institute's Academic Advisory Board. Federalist Government in Principle and Practice looks at the relationship between federalism and liberty and explores the substantive practice of federalism, particularly the centralizing processes at work and the opportunities for decentralization.

  
  
  
• Education
  

  Remember the First Amendment. Stop Political Bullying in Our Schools!

  By Deborah D. Thornton, Public Interest Institute
  
  Institute Brief, 09/25/2008
  

  Iowa Code section 280.28 requires all schools to enforce and report “harassment and bullying” of students. The protected traits or characteristics include “political party preference” and “political belief”. However, as early as January 2008, during the Iowa Presidential Caucuses, students reported that they felt “ganged up on” in class and were not offering comments on political issues because of the hostile response of their classmates. They did not feel “safe” from the tyranny of the majority. We must work to ensure this is not the case in our children’s classrooms. Minority group and opinion protection is an integral part of the United States Constitution, and of our liberties, and must be actively supported by all citizens.

  
  
  
• The Constitution/Civil Liberties
  

  District of Columbia v. Heller: A Victory and a Warning

  By John R. Hendrickson, Public Interest Institute
  
  Institute Brief, 09/25/2008
  

  The decision in District of Columbia v. Heller is important not only for the constitutional outcome, but for the need to uphold the Constitution in the original written framework of the Founders and not as a “living Constitution.” The judiciary has a responsibility to uphold the Constitution, and when meaning is unclear, it is vital to understand the textual meaning of the language used by the Framers. The Heller decision is a victory for liberty, but it also should serve as a serious warning that the Supreme Court’s decision could have been substantially different if one Justice decided to join the dissenting opinion. That is why the electorate needs to understand the importance of originalism and textualism. Just one vote stood in the way of altering a substantial constitutional freedom and liberty: the right to keep and bear arms—America’s first freedom as eloquently argued by the National Rifle Association.

  
  
  
• Education
  

  Enrollment Trends in Massachusetts

  By Ken Ardon, Pioneer Institute for Public Policy Research
  
  Policy Brief, 09/25/2008
  

  Enrollment in public schools in Massachusetts has fallen by 24,000 students, or 2.5 percent, over the past five years. Ultimately, there is no simple policy prescription to the problems that will result from declines in enrollment, but better enrollment data should be the basis of any solution. For example, the ongoing decline in public school enrollment is likely to increase political pressure to limit charter schools, but as the decline is being driven by demographics, charter schools should not be blamed. In fact, the growth at charter schools suggests that some cities could stem the outflow of students by increasing the number of charter schools in their districts or instituting charter-like reform in district schools.

  
  
  
• Education
  

  Differential Pay for Math and Science Teachers

  By Theodor Rebarber, Kathleen Madigan, Pioneer Institute for Public Policy Research
  
  Policy Brief, 09/25/2008
  

  Teachers are critical to attaining world-class levels of performance in mathematics and science. A growing body of research has documented a wide range in the effectiveness of individual teachers with respect to raising student achievement. The current compensation system rewards traditional teacher qualifications that have been demonstrated as unrelated to raising achievement, including whether a teacher possesses a general education certificate, an advanced degree, or years of experience after the first two to three. A performance-based approach is more likely to encourage the best teachers to remain, while perhaps also encouraging the least effective to seek more productive employment elsewhere.

  
  
  
• Health Care
  

  Mandates or Markets?

  By Patrick B. McGuigan , Oklahoma Council of Public Affairs
  
  Report, 09/24/2008
  

  Earlier this year, the Oklahoma Comprehensive Health Independence Plan, or O-CHIP, was introduced into the intensifying debate over what direction our state will take on arguably the most immediate of many pressing economic challenges. If state leaders move Oklahoma’s insurance policy dynamic in the directions envisioned in O-CHIP, the state could position itself anew as business-friendly and determined to enhance our competitive advantages. This would help retain small business as the engine of job creation, economic growth, and dynamism.

  
  
  
• Education
  

  District Consolidation and the Threat to School Choice: 15 Reorganization Plans to Watch

  By Stephen Bowen, Maine Heritage Policy Center
  
  Issue Brief, 09/24/2008
  

  As The Maine Heritage Policy Center reported in a recent policy brief titled Reorganization and the Threat to Maine’s Tradition of School Choice, opportunities for families to choose the schools their children attend are in danger as a result of the ongoing school district consolidation effort. For generations, students in many Maine communities have been allowed to choose the school they attend under the state’s “town tuitioning” program. The competition between schools that has resulted from these opportunities for school choice has been proven to result in higher quality schools and improved student outcomes. Unfortunately, the current school district consolidation effort has put these choice options at risk and has already resulted in the loss of school choice options in four of the towns that now comprise the very first regionalized school district, RSU 1 in Bath.

  
  
  
• Education
  

  After Milwaukee

  By Frederick M. Hess, American Enterprise Institute
  
  Report, 09/24/2008
  

  We should have no difficulty conceding Milwaukee’s disappointing record while remaining coolly confident that sensible K–12 market reforms have the potential to boost productivity, spur purposive innovation, provide more nuanced accountability, and make the sector a magnet for talent. Failures to date should not be read as indictments of market reform but of the notion that “parental choice” programs represent a coherent approach to improving our schools. Reaching that goal will require approaching educational deregulation with an agenda much broader than simply increasing parental choice. Little has been done to eliminate the ways in which state regulations, licensure requirements, and funding systems stifle entrepreneurial ventures.

  
  
  
• Labor
  

  Union Members’ Attitudes Toward Their Unions’ Performance

  By Joseph G. Lehman, Mackinac Center for Public Policy
  
  Policy Brief, 09/24/2008
  

  The future viability of unions as a political force may be revealed by today’s attitudes of union members toward their unions. This summer Zogby International and the Mackinac Center for Public Policy undertook a nationwide survey of union members to determine their views of their unions’ performance. We asked union members about union effectiveness, union responsibilities, union political spending, ways for workers to create a union and how unions should treat workers. The survey results illuminate discussion of one long-term trend and one current legal issue. Overall union membership has declined significantly in the United States since the 1970s, even in Michigan. Worker attitudes toward their own unions may partly explain the lessening appeal of unions. The survey findings suggest that union members support many of their unions’ goals, but confidence in long-term union viability and some union spending is not high.

  
  
  
• Labor
  

  What a Right-to-Work Law Would Mean for Cities

  By Paul Kersey, Mackinac Center for Public Policy
  
  Michigan Privatization Report, 09/24/2008
  

  There is a distinct likelihood that Michigan voters will be presented with a right-to-work ballot initiative or constitutional amendment over the next few years. Under right-to-work legislation, a collective bargaining agreement could no longer include the requirement of workers either joining the union or paying an agency fee in lieu of membership dues. Union membership and financial support would be left to the discretion of the individual employee. Assuming that such a law passes, what would the effect be for local governments and their employees? While a right-to-work law would not have a large, immediate or direct impact on the operation of county and municipal governments, over the long term such a law could do much to indirectly improve their financial situations.

  
  
  
• Education
  

  Health Insurance: Reformed, but Not Resolved

  By Lorie A. Shane, Mackinac Center for Public Policy
  
  Report, 09/24/2008
  

  Michigan’s 2007 Public Employees Health Benefit Act was designed to address health insurance costs by requiring school districts to gather competitive bids before awarding new contracts. The same act required insurance companies and third-party administrators to provide aggregate claims data to the districts they serve, so the data could be used by other companies in preparing bids. Sounds like a straightforward process, but the number of contracts yet to be settled in Michigan says otherwise. The first round of mandated bidding was based on short-term claims information, which may have skewed final cost estimates. And since the law does not say that a school district has to accept the lowest bid and does not take the issue of health benefits off the bargaining table, school districts and their unionized employees continue to argue over which benefit plan a district can afford, which company should provide it, and whether current bids are true predictors of coming years’ costs.

  
  
  
• Education
  

  Merit-Pay Pilot Program for Michigan Public Schools

  By Marc J. Holley, Patrick J. Wright, Mackinac Center for Public Policy
  
  Policy Brief, 09/24/2008
  

  A privately financed merit-pay bonus program is feasible and potentially powerful. It could generate new and valuable data about how teachers respond to financial incentives and how much teachers are able to improve student achievement. Moreover, successful results could easily spark interest in teacher compensation reform outside a single district or charter school. Michigan residents, businesses, educators and policymakers are growing hungry for ideas that provide real grounds for hope, rather than grounds for more spending and uninspiring results.

  
  
  
• Education
  

  Parent Satisfaction Higher in Private Schools

  By The Mackinac Center for Public Policy, Mackinac Center for Public Policy
  
  Report, 09/24/2008
  

  Parents of children who attend private schools are more satisfied with their schools than parents of children in public education settings, according to a new report from the National Center for Education Statistics, while parents whose children attend the public school of their choice are more satisfied than those whose children attend an assigned public school. The study also found that parents in smaller schools, regardless of whether the school is public or private, are more satisfied than those whose children attend larger schools; parental dissatisfaction grows with the age of the child; parents of black students were less likely to be very satisfied with schools than parents of white or Hispanic students; more private school parents than public reported having served on a school committee or participating in school fundraising; and parents of children in smaller schools or in elementary grades reported more participation than those in larger schools or higher grades.

  
  
  
• Education
  

  Charter Schools Gains Coming, Slowly, in Virginia

  By Don Soifer, Lexington Institute
  
  Issue Brief, 09/24/2008
  

  Of the various reasons why the charter school movement has developed slowly in Virginia, perhaps the most significant is a restrictive state law that allows only local school boards to authorize charters. In states with stronger charter movements, education laws permit multiple chartering authorities, giving applicants an option when school boards prove unwilling to consider them seriously. Proposals have been introduced in Virginia’s legislature in each of the past two sessions to allow public universities to serve as charter authorizers, a system that has proven successful in other states, most notably in Michigan. Another approach could be to establish a new, statewide school district consisting of only charter schools, which could be overseen by state officials.

  
  
  
• Foreign Policy/International Affairs
  

  United Nations Has a Better Solution for Cluster Bombs

  By Loren B. Thompson, Lexington Institute
  
  Issue Brief, 09/24/2008
  

  The global community is gradually moving to ban conventional weapons that are deemed too indiscriminate in their effects to comply with prevailing standards of behavior in wartime. Weapons such as land mines pose risks for non-combatants that are increasingly viewed as unacceptable by most civilized people. The latest category of weapons to be subjected to global scrutiny is cluster munitions, and multiple treaties are currently pending to proscribe their use. It isn’t hard to see why civilized opinion has turned against such weapons, especially given the vast array of alternatives for waging war more humanely. However, past experience has proven that poorly-constructed treaties for prohibiting whole categories of weapons can have unintended effects. The Oslo treaty would ban these advanced munitions, thus depriving militaries of a more humane weapon. The United Nations treaty represents a more acceptable solution to the problem with a more inclusive process.

  
  
  
• National Security
  

  Plan to Stop Buying Strategic Missile Motors is a Mistake

  By Loren B. Thompson, Lexington Institute
  
  Report, 09/24/2008
  

  What is the single greatest danger to America’s survival? Global terrorism? Biological warfare? Cyber attacks? Nope, none of the above. The biggest threat by far is still the Russian nuclear arsenal. If Russian leaders decided to launch a large-scale strategic missile attack against America right now, most of the people you know would be dead by sunset. And there’s basically nothing we could do about it – nothing, that is, except destroy Russia in retaliation. The Air Force has decided to further compromise the credibility of our nuclear deterrent by ceasing production of Minuteman missile motors next year for the first time since construction began 50 years ago. This is a dangerous move that can be avoided at very modest cost by continuing to build a dozen motors per year.

  
  
  
• National Security
  

  Netting the Navy

  By Loren Thompson, Lexington Institute
  
  Report, 09/24/2008
  

  The Navy and Marine Corps are implementing network-centric warfare concepts to cope with a diverse array of emerging threats. Wireless networks enable the sea services to apply limited warfighting assets more flexibly and precisely. Several next-generation programs such as the Joint Tactical Radio System, E-2D Advanced Hawkeye radar plane, P-8A Poseidon patrol plane and Littoral Combat Ship were designed from the outset to be network-centric. However, most networking advances in the near term will probably follow the path of the Marine Corps “Corporal” program by introducing new technology into legacy systems – a low cost way of enhancing warfighter capabilities quickly.

  
  
  
• National Security
  

  Decaying Air Power Reflects Larger Problems

  By Loren B. Thompson, Lexington Institute
  
  Report, 09/24/2008
  

  This presentation addresses the causes and consequences of lagging investment in next-generation aerospace technology, the decline of American air dominance, and implications for the Air Force’s future roles. The good news is that America is spending as much as the rest of the world combined on advanced military technology. The bad news is that we have not managed to spend that money efficiently, and the availability of funds for new weapons is likely to shrink considerably in the years ahead. The Air Force and other defense agencies will need to redouble efforts to achieve horizontal integration of diverse collection systems if global awareness capabilities are to meet the needs of the joint force in the future, especially given all the mis-steps in modernization during the Bush years.

  
  
  
• National Security
  

  Technology Readiness for a New Long-Range Bomber

  By Rebecca Grant, Lexington Institute
  
  Report, 09/24/2008
  

  America has relied on its bombers to attack the toughest targets when nothing else in the arsenal of democracy could do the job. Now for the first time the Air Force has candidly admitted that when the red phone rings after 2015, bombers may not be up to the job. Talk of a new bomber has come in fits and starts since the Pentagon reached the decision to curtail the B-2 program over fifteen years ago. But no one was serious about putting the money behind it until very recently. Then, in 2006, the new goal became to “Develop a new land-based, penetrating long-range strike capability to be fielded by 2018 while modernizing the current bomber force,” (Quadrennial Defense Review Report). Since then, signs have indicated that the Air Force has been quietly at work on the development of a new bomber.

  
  
  
• National Security
  

  Visa Waiver Program Hearing Should Consider DHS Progress toward Increased Security

  By Jena Baker McNeill, The Heritage Foundation
  
  WebMemo, 09/24/2008
  

  The Government Accountability Office (GAO) has released a report criticizing the Department of Homeland Security’s (DHS) implementation of the new congressional security measures aimed at the Visa Waiver Program. DHS counters this report by emphasizing that in a very short period of time, it has made considerable progress toward meeting the looming January deadline. It emphasizes that there is good news to share and that the GAO report was simply premature. We can hope Congress will use today’s hearing as an opportunity to ask thought-provoking questions while also listening to the to the Department’s answers.

  
  
  
• Monetary Policy/Financial Regulation
  

  Financial Cleanup Steps for Congress—The Next Steps and Beyond

  By J.D. Foster, The Heritage Foundation
  
  WebMemo, 09/24/2008
  

  Federal interventions in the free markets over the years contributed to the current mess, and unfortunately, it will take a heavy dose of intervention to get us out again. But as it considers these issues in the months ahead, Congress should learn the lesson that when allowed to operate with as little federal meddling and bias as possible, markets remain the nation’s most effective means of achieving prosperity.

  
  
  
• Foreign Policy/International Affairs
  

  Iranian President Ahmadinejad’s Vexing Visit Exposes U.N. Failures

  By James Phillips, The Heritage Foundation
  
  WebMemo, 09/24/2008
  

  The United States should try to ramp up further sanctions against Iran outside the United Nations framework by working directly with its Japanese and European allies to impose the strongest possible bans on investment, loans, and trade with Iran. But the tight world oil market reduces the prospects that effective sanctions will ultimately be applied. The bottom line is that the failure of the United Nations to enforce the Nuclear Non-Proliferation Treaty and advance the collective security of its members has increased the chances of war in the near future.

  
  
  
• National Security
  

  Building Infrastructure Resiliency: Private Sector Investment in Homeland Security

  By Jena Baker McNeill, The Heritage Foundation
  
  Backgrounder, 09/24/2008
  

  The infrastructure of the 21st century requires a 21st-century approach. America must expand beyond the protection-based mindset and shift to resiliency. Without resiliency, America’s infrastructure will continue to crumble and any catastrophic event will be all the more devastating. Investment by the private sector preserves American notions of limited government, while preserving American livelihoods for future generations.

  
  
  
• Foreign Policy/International Affairs
  

  China: Wealthy State, Strong Army—and a Powerful Party

  By John J. Tkacik, The Heritage Foundation
  
  WebMemo, 09/24/2008
  

  Unless the next President of the United States adopts greater skepticism toward China’s future intentions; reaffirms America’s commitment to like-minded economic, political, and security allies around the world; and seeks aggressive enforcement of the global economic rules it has done more than any other nation to establish, there will be precious little to prevent China from changing the geo-political rules to suit its own interests. The United States certainly needs to balance China’s rise, but it also needs to create and nurture a balance of forces in favor of economic and political freedom.

  
  
  
• The Constitution/Civil Liberties
  

  The Perils of Judicial Policymaking: The Practical Case for Separation of Powers

  By Joshua Dunn, The Heritage Foundation
  
  First Principles, 09/24/2008
  

  Critics of the judiciary’s ever-growing role in American politics usually focus on how it erodes self-government or, most severely, leads to judicial tyranny. If, as James Madison argues in Federalist No. 47, the accumulation of legislative, executive, and judicial powers in the same hands “is the very definition of tyranny,” these concerns are well founded. With the courts determining public policy on everything from abortion to obscenity to public displays of the Ten Commandments, there is no shortage of evidence on display.

  
  
  
• Monetary Policy/Financial Regulation
  

  The Financial Bailout (and the New Resolution Trust Corp.) Must Restore the Markets and Protect the Taxpayer

  By David C. John, The Heritage Foundation
  
  WebMemo, 09/24/2008
  

  The House and Senate must have two objectives when putting together their versions of the financial bailout proposal made by the Treasury and Federal Reserve: They must (1) restore the markets and (2) protect the taxpayers. Congress should act clearly and decisively to address the turmoil in the financial markets and not burden this legislation with other issues, problems, or projects.

  
  
  
• Elections, Transparency, & Accountability
  

  Removing FEMA from DHS Would Be a Terrible Mistake

  By Jena Baker McNeill, The Heritage Foundation
  
  WebMemo, 09/24/2008
  

  Once again, people are arguing that the Federal Emergency Management Agency (FEMA) should be taken out of the Department of Homeland Security. Recent disaster responses, from the California wildfires to Hurricane Ike, demonstrate that FEMA is operating effectively within the department. Congress should reject calls to make FEMA a stand-alone agency.

  
  
  
• Education
  

  Academic Success Begins at Home: How Children Can Succeed in School

  By Christine Kim, The Heritage Foundation
  
  Backgrounder, 09/24/2008
  

  While numerous education reforms over the last quarter century have demonstrated little impact on overall student achievement, the research clearly shows that the intact family structure and strong parental involvement are significantly correlated with educational outcomes, from school readiness to college completion. Instead of favoring proven ineffective education policies, policymakers seeking effective education reform should consider policies that strengthen family structure in America and bol¬ster parental involvement and choice in education.

  
  
  
• Foreign Policy/International Affairs
  

  A Decade Under Chávez: Political Intolerance and Lost Opportunities for Advancing Human Rights in Venezuela

  By Alisha Holland, et al., Human Rights Watch
  
  Report, 09/23/2008
  

  It has been 10 years since Hugo Chávez was elected president of Venezuela and set out to overhaul the country’s largely discredited political system. His first major achievement, the enactment of a new constitution in 1999, offered an extraordinary opportunity for the country to shore up the rule of law and strengthen the protection of human rights. But this historic opportunity has since been largely squandered. The most dramatic setback came in April 2002 after a coup d’état that temporarily removed Chávez from office. Within 40 hours, the coup unraveled, Chávez returned to office, and the constitutional order was restored. But while this derailment of Venezuelan democracy lasted less than two days, it has haunted Venezuelan politics ever since, providing a pretext for a wide range of government policies that have undercut the human rights protections established in the 1999 Constitution.

  
  
  
• Family, Culture & Community
  

  The Effect of Parental Involvement Laws on the Incidence of Abortion among Minors

  By Michael J. New, Family Research Council
  
  Insight, 09/23/2008
  

  This comprehensive analysis of minor abortion data from nearly all 50 states between 1985 and 1999 demonstrates that state-level parental involvement laws are effective in reducing the incidence of abortion among minors. Overall, the findings indicate that when a state enacts a parental involvement law, the abortion rate falls by an average of approximately 13.6 percent.

  
  
  
• Monetary Policy/Financial Regulation
  

  Personal Lines Regulatory Framework

  By Lawrence A. Hunter, George Pieler, Institute for Policy Innovation
  
  Report, 09/23/2008
  

  The National Association of Insurance Commissioners (NAIC) needs to focus on competition among its members to remove or relax unproductive regulations. We recommend that NAIC establish a task force devoted to identifying needless rules and regulations, and a range of market-based models for what efficient regulation would consist of. Where appropriate, such a task force should consider encouraging the use of regulatory compacts to test out market-based reforms on a wide scale, with the goal of encouraging model legislation suitable for a 21st century market. In today’s global economy where different forms of financial services compete one-on-one and there increasingly is tighter integration of markets for good and services coupled with the revolution in telecommunications, regulatory provincialism becomes not just an anachronism but also a dereliction of the best interests of the citizens of the several states.

  
  
  
• Budget & Taxation
  

  Amendment 59 Gives the Education Lobby a Blank Check

  By Barry Poulson, Independence Institute
  
  Issue Backgrounder, 09/23/2008
  

  Amendment 59 on Colorado’s November statewide ballot, also known as the SAFE (or Savings Account For Education) Initiative, suffers from two major shortcomings. One is the substantive impact this initiative would have on fiscal policies in the state. The second is the procedural problems the Initiative would create in designing and implementing our fiscal policies. The Initiative would subvert the I&R process from one designed to set limits on government excess, to one that will capture more state revenue for special interests.

  
  
  
• Elections, Transparency, & Accountability
  

  Opening Government: Mashups

  By Jerry Brito, Mercatus Center
  
  Mercatus on Policy, 09/23/2008
  

  Making government information available online would not only benefit individual users of government websites, it would also make it simpler for third parties to aggregate government data. By aggregating data, websites can present government information in innovative and useful ways. For example, federal spending data gathered from a government website could be presented by a third party as an interactive map that shows the locations of funding recipients. Such applications make data exponentially more valuable. Government need not develop such innovative tools itself; as long as the data is made available online in a structured format, private parties will make good use of it.

  
  
  
• Monetary Policy/Financial Regulation
  

  Subprime Lending

  By Andrew Perraut, Todd Zywicki, Mercatus Center
  
  Mercatus on Policy, 09/23/2008
  

  As foreclosures rise, the collapse of the subprime market has generated calls for reform from Congress to the campaign trail. Foreclosures have risen dramatically, and there is little doubt that the excesses of recent years were marked by fraud and recklessness by borrowers and lenders. But this crisis calls for sensible regulation, not demonization. The growth of subprime lending has had both benefits and costs, not only to private homeowners, but to neighborhoods and communities. Subprime lending has raised home ownership rates, especially among the lowest-income Americans, and has contributed to stronger neighborhoods and the happiness of homeowners and their families. At the same time, default rates for these riskier borrowers have risen in recent years, resulting in higher foreclosure rates and adverse neighborhood impacts. Sensible regulation of subprime lending should seek to curb abusive practices while preserving this important tool for economic mobility.

  
  
  
• Foreign Policy/International Affairs
  

  Europe’s Brave New World—Security Implications of Global Population Changes, 2007-2050

  By Jack Goldstone, Mercatus Center
  
  Working Paper, 09/23/2008
  

  Four major trends in global population are likely to pose significant security challenges to Europe in the next two decades. These are (1) disproportionate population growth in large and Muslim countries; (2) shrinkage in population and dramatic shifts in age structure in the European Union; (3) sharply opposing age shifts between First World countries and youthful Third world countries, especially those close to Europe; and (4) increased immigration from Third World to First World countries.

  
  
  
• Regulation & Deregulation
  

  The Incredible Growth of the Regulators’ Budget

  By Veronique de Rugy, Mercatus Center
  
  Working Paper, 09/23/2008
  

  Regulatory expenditures and staffing are significantly larger in 2009 than they were in 2000. Driven largely by homeland security activities, staffing levels requested in 2009 are 50.3 percent larger than they were in 2000. The new budget calls for expenditures that are 67.8 percent higher than in 2000—an increase in real spending on regulatory activities of $17.2 billion between 2000 and 2009. This level of spending on regulatory agencies is the highest in real dollars in the last fifty years. Tracking the expenditures of federal regulatory agencies and the trends in regulatory spending over time helps analysts monitor one aspect of the cost of regulations: the direct cost to regulate the economy and taxpayers’ lives. We know that if the Regulators’ Budget increases, it means that the direct cost of running regulatory agencies increases, and when it goes down, the cost is reduced.

  
  
  
• Regulation & Deregulation
  

  Empirical Tests for Midnight Regulations and Their Effect on OIRA Review Time

  By Patrick McLaughlin, Mercatus Center
  
  Working Paper, 09/23/2008
  

  The midnight regulations phenomenon—an increase in the rate of regulation promulgation during the final months of an outgoing president’s term—is empirically tested using Office of Information and Regulatory Affairs (OIRA) data on the number of economically significant regulations reviewed each month. Submissions of economically significant regulations to OIRA are found to increase by about 7 percent during midnight periods. Spikes in regulatory activity, such as those of midnight periods, are shown to decrease the average amount of time regulations are under review at OIRA, perhaps because of budget and staff limitations at OIRA. If OIRA review improves the quality of regulations, then any phenomenon such as midnight regulations that leads to spikes in regulatory activity that decreases in average review time could result in the occasional proliferation of low-quality regulations.

  
  
  
• Budget & Taxation
  

  Both Candidates’ Tax Plans Will Reduce Millions of Taxpayers' Liability to Zero (or Less)

  By Scott A. Hodge, Tax Foundation
  
  Fiscal Facts, 09/23/2008
  

  Over the past two decades, lawmakers have increasingly turned to the tax system rather than direct spending programs to funnel money to targeted groups of Americans, furthering some social or political goal. As a result, millions of Americans have been effectively removed from the income tax payment system while the tax code has been made more complicated to comply with and more difficult to administer. The tax plans of both the presidential candidates would exacerbate this situation greatly. It is time for a serious public discussion of whether it is desirable to have so many Americans disconnected from the cost of government and what the consequences are of using the tax system as a vehicle for social policy.

  
  
  
• Monetary Policy/Financial Regulation
  

  The Fed’s “Depression” and the Birth of the New Deal

  By Lawrence M. Stratton, Paul Craig Roberts , Hoover Institution
  
  Policy Review, 09/23/2008
  

  The Federal Reserve is the most powerful institution of a new order that believed in the efficacy of government and its ability to do good. The same Federal Reserve caused the Great Depression when its wise men made a series of cumulative mistakes that contracted the money supply by one-third and wiped out purchasing power in an unprecedented fashion. Mistakes play a dramatic role in history. The Fed’s mistakes led to others even more serious. The New Deal and the Great Society are the unfortunate consequences of the progressives’ trust in wise men and their lack of faith in the market. Now that the market has triumphed everywhere and its supposed greatest failure can be seen to have lain with the unwise actions of the wise men themselves, the legacy of the progressives looks more dubious than ever.

  
  
  
• Crime, Justice & the Law
  

  S. 3325: A Stitch in Time Can Save Billions

  By Thomas Sydnor II, Progress & Freedom Foundation
  
  Progress Snapshot, 09/22/2008
  

  During the remainder of this session, the U.S. Senate should pass S. 3325, the Enforcement of Intellectual Property Rights Act of 2008 (“ERIPA”). ERIPA would reform federal Intellectual Property Rights (IPR) enforcement efforts by providing dedicated investigators and better coordinating state, federal, and international IPR-enforcement efforts. Passing ERIPA now will create a net increase in federal revenues, grow the U.S. economy, protect consumers from dangerous goods, and attack organized crime.

  
  
  
• Information Technology
  

  Comments to the FCC Regarding Sponsorship Identification Rules and Embedded Advertising

  By W. Kenneth Ferree, Adam Thierer, Progress & Freedom Foundation
  
  Testimony, 09/22/2008
  

  In the name of protecting consumers from “hidden” advertisements, the Federal Communications Commission (FCC) is contemplating rules that likely would destroy the financial health and well-being of the free broadcast medium and unfairly handicap cable services vis-à-vis new media platforms. Indeed, because of the steady progress of media technology, the very rationale for FCC content regulation of broadcast and cable programming has become superannuated. Advertisers and consumers have moved on and are adapting to the 21st Century media marketplace–the Commission should, too.

  
  
  
• Economic Growth
  

  Crowding Out in New Orleans: Relief-Related Wage Effects on Investment?

  By Nicole L. Cornell Sadowski, Mercatus Center
  
  Working Paper, 09/22/2008
  

  There are varying viewpoints on the level to which relief agencies should be involved in the rebuilding efforts of areas which have been affected by a natural disaster. Above-average wages paid by relief agencies in the wake of Hurricane Katrina in the New Orleans metro area have highlighted the potential for government to crowd out local businesses—via employment in the short-term and investment in the long-term. This study analyzes the effect of wage increases on investment in New Orleans pre-Katrina, the extent of overall wage increases following the storm, and their estimated effects on employment and investment. Four scenarios for relief agency withdrawal from the labor market were tested. A gradual decrease through 2010 appears to result in the lowest levels of investment crowding-out, as well as producing the most favorable outcomes for other economic measures.

  
  
  
• Regulation & Deregulation
  

  Regulation in the 21st Century

  By Bruce Yandle, Henry Wray, Mercatus Center
  
  Working Paper, 09/22/2008
  

  Throughout the life cycle of the regulatory process, opportunities exist to substantially increase the net benefits of the entire system for both the near and long term. Regulatory agencies should consider more market-oriented solutions (such as performance standards and economic incentives) first and command-and-control options last and perform an assessment of the effects of major regulation on competition. Independent regulatory agencies should be subject to a congressional oversight unit, similar to the Office of Information and Regulatory Affairs. Agencies that develop voluntary standards should license the use of the agency’s seal to be used on consumer products to signal approval.

  
  
  
• Regulation & Deregulation
  

  Facilitated Market Solutions for Social Problems

  By Richard A. Williams, Andrew Perraut, Mercatus Center
  
  Working Paper, 09/22/2008
  

  A facilitated market solution is a deliberate assembly of stakeholders led by a private professional organization to solve a specific social problem. It has several advantages over governmental regulatory negotiations. First, solutions to social problems can come much more quickly than through the cumbersome notice-and-comment rulemaking. Next, because the involved stakeholders are not bound by antiquated laws or precedents that must be stretched, they are free to come up with novel solutions. Third, the stakeholders at hand often have all of the possible relevant data needed for decision making. Fourth, the stakeholders are those people most affected by the decisions. Finally, many regulations result from intense pressure on bureaucracies, usually to respond to a problem even when they do not have a good solution. They will produce something just to appear to be doing something about a problem without really solving it. If all sides are well represented in a privately mediated agreement, that problem is unlikely to arise.

  
  
  
• Health Care
  

  State Health Reform: How States Can Control Costs and Expand Coverage

  By Dennis G. Smith, The Heritage Foundation
  
  Backgrounder, 09/22/2008
  

  It is popular to think that states can do nothing about the cost of health care. But policymakers have already seen the dangers of “free” money demonstrated in Missouri and Tennessee. As long as Medicaid is a matching program, the federal government will eventually insist that the states pay their share. As such, states eventually face painful decisions to restore order to their budgets. But even getting the Medicaid budget in order does not repair the damage to the private insurance market on which most American families rely. In fact, some of the Medicaid remedies, such as benefit and eligibility expansions, can disrupt the private market even further, causing a “crowd out” of existing private coverage. Governors and state legislators should ignore those who insist that the only solution is to obtain more money from the federal government and instead focus new efforts on returning competition to their states’ health insurance markets.

  
  
  
• Monetary Policy/Financial Regulation
  

  What Should Be Done About the Financial Markets?

  By Stuart M. Butler, Alison Acosta Fraser, James L. Gattuso, The Heritage Foundation
  
  WebMemo, 09/22/2008
  

  As a general principle, the federal government should not intervene to stave off the consequences of unwise business decisions. But we experiencing one of those rare situations in which a wave of bad decisions in one sector has such dire consequences for the most basic operations of the economy that other sectors are threatened, jeopardizing the functioning of the entire economy. As they evaluate proposals, lawmakers should be guided by the following goals and strategies: do not prop up failed or failing institutions; do not try to support prices; do not allow the government to become the permanent “owner of last resort”; strictly limit legislation to the immediate need to stabilize the financial situation; avoid the “moral hazard” of encouraging other institutions to come to government for financial bailouts; carefully define the federal government’s role; limit taxpayer exposure and keep actions temporary; assure liquidity in markets but require full pricing of government insurance.

  
  
  
• Monetary Policy/Financial Regulation
  

  First Thoughts on the New Resolution Trust Corporation

  By David John, J. D. Foster, The Heritage Foundation
  
  WebMemo, 09/22/2008
  

  The extraordinary turmoil and fear in American and other financial markets have triggered equally extraordinary policy actions and proposals in Washington and New York City. Congress and the Administration should follow key principles in structuring any new Resolution Trust Corporation (RTC)-like entity in order to meet the goal of stabilizing the market with the least danger to the taxpayer. For example, the agency should have a limited scope and lifespan; it should not take an ownership stake in financial institutions; any net profits should go to the taxpayers; companies should pay for this assistance; and the agency should operate using private entities wherever possible. Lastly, the legislation should be kept clean: this bill is the response to a major crisis and not an excuse for legislators to advance their pet projects.

  
  
  
• International Trade/Finance
  

  Trade Liberalization Continuing Despite Doha Impasse

  By Daniella Markheim, Terry Miller, The Heritage Foundation
  
  Backgrounder, 09/22/2008
  

  The 2009 rankings of trade freedom in countries around the world, developed by The Heritage Foundation as part of its annual Index of Economic Freedom and released to the public today, show many countries moving ahead on their own to lower tariffs and cut other barriers to trade. This is good news for consumers and businesses in those countries that will enjoy greater access to competitively priced goods from around the world. Countries standing still or moving backward in response to protectionist political pressures, however, are likely to find themselves falling behind, with lower growth rates and stagnating economies.

  
  
  
• Budget & Taxation
  

  Time to Move Iraq and Afghanistan Funding into the Regular Budget Process

  By Brian M. Riedl, Baker Spring, The Heritage Foundation
  
  WebMemo, 09/22/2008
  

  Funding the activities in Afghanistan and Iraq through emergency bills made sense immediately following the 9/11 attacks and in the first few years of the Iraq conflict. In 2008, however, the funding needs of the Iraq and Afghanistan conflicts have stabilized, and the need for separate emergency bills has run its course. Lawmakers should begin folding this spending into the regular budget process, while allowing for the resumption of emergency bills in the event of an unforeseen terrorist or military crisis.

  
  
  
• Natural Resources, Energy, Environment, & Science
  

  Lower Home Heating Bills by Increasing Domestic Energy Supplies

  By Ben Lieberman, The Heritage Foundation
  
  WebMemo, 09/22/2008
  

  Gasoline prices have fallen a bit since hitting $4.00 a gallon last summer, but America’s total energy bill is going to increase in the months ahead as we enter the home heating season. The costly double whammy of still-high pump prices and equally painful heating bills underscores the need for the federal government to do what it can to make energy as affordable as possible. Beyond federal assistance programs to help the poor with their high energy bills, Washington can and should do more to bring prices down by removing the restrictions on domestic energy production. Congress will soon have the chance to take an important step in this direction by allowing the current moratorium on offshore drilling to lapse.

  
  
  
• Economic Growth
  

  A Second Economic Stimulus Bill Will Fail—Just Like the First

  By Rea S. Hederman, Jr., Stephen Keen, Brian M. Riedl, The Heritage Foundation
  
  Backgrounder, 09/22/2008
  

  On almost every economic measure one could choose, economic activity is slower now than at the beginning of the year, and this record indicts, as does nothing else, the ineffectiveness of Congress’s first stimulus legislation. Stimulus bills should not become vehicles for pork projects and additional spending under the guise of undefined “stimulus.” The provisions in the second stimulus bill will do little to aid the economy since they will merely redistribute money from one sector to another, from one group of people to another. History has proven that large government spending programs are not the antidote for a slow economy. Congress should learn from its previous mistakes, including the first stimulus bill, and not consider proposals that increase the debt and do little to boost the economy.

  
  
  
• Foreign Policy/International Affairs
  

  United Nations Peacekeeping: The U.S. Must Press for Reform

  By Brett D. Schaefer, The Heritage Foundation
  
  Backgrounder, 09/22/2008
  

  The unprecedented pace, scope, and ambition of United Nations peacekeeping operations have led to numerous flaws, limitations, and weaknesses that are serious and need to be addressed. The Bush Administration and Congress need to consider carefully any requests by the United Nations for additional funding for a system in which procurement problems have wasted millions of dollars and sexual abuse by peacekeepers is still occurring. Without fundamental reform, these problems will likely continue and expand, undermining the United Nation’s credibility and ability to accomplish one of its primary missions: maintaining international peace and security.

  
  
  
• National Security
  

  Homeland Security 3.0: Building a National Enterprise to Keep America Safe, Free, and Prosperous

  By David Heyman, James Jay Carafano, The Heritage Foundation
  
  Special Report, 09/22/2008
  

  The most pressing needs for enhancing the protection of the country from transnational terrorist threats do not lie in further major reorganization of the Department of Homeland Security or revisiting its roles and missions. Rather Congress and the Administration should shift their focus to strengthening the effectiveness of the national homeland security enterprise as a whole. To be more agile, our bureaucracy must foster better decision making in Congress and in the interagency process, support the development of a new generation of professionals, and facilitate information sharing throughout all elements of the enterprise. Furthermore, to close the gaps where terrorists hide, we must empower individuals and communities and extend international cooperation throughout our homeland security activities.

  
  
  
• Immigration
  

  Time Is Ticking: Congress Must Re-Authorize E-Verify Now

  By James Jay Carafano, The Heritage Foundation
  
  WebMemo, 09/22/2008
  

  Unless Congress steps in, on November 30, E-Verify is set to expire. E-Verify is a system that allows employers to verify electronically whether their newly hired employees are legally authorized to work in the United States. E-Verify should be re-authorized.

  
  
  
• Crime, Justice & the Law
  

  The MySpace Suicide: A Case Study in Overcriminalization

  By Andrew M. Grossman, The Heritage Foundation
  
  Legal Memorandum, 09/22/2008
  

  Lori Drew was indicted under a federal anti-computer hacking statute for impersonating a young man on MySpace to gain the trust of an emotionally troubled teen, Megan Meier, who killed herself after the cruel joke spun out of control. Convicting Lori Drew of the charges leveled against her is bad law, no matter what her transgressions have been, but the recent trend in criminal law—one of great expansion and few checks—suggests that a conviction on the government’s excessively creative legal theory is not unlikely. Even if she prevails, Drew has still had to suffer the rigors of prosecution, a burden that any person would rightly fear. If the facts are as alleged, Drew does deserve punishment, but it need not, and should not, be of a criminal nature, for the simple reason that she committed no crime.

  
  
  
• Economic and Political Thought
  

  Free-Market Philanthropy: The Social Aspect of Entrepreneurship

  By Guinevere Nell, James Sherk, Paul L. Winfree, The Heritage Foundation
  
  Center for Data Analysis Report, 09/22/2008
  

  Free markets rely on the entrepreneurial spirit, but that urge to create, innovate, and succeed is not grounded in self-centeredness. Entrepreneurs are no greedier than anyone else. On the contrary, the typical entrepreneur gives generously from the wealth he creates. Believing that government redis¬tribution of wealth is harmful for the economy does not signify supporting a society where “You're on your own.” Free markets enable entrepreneurs to become very wealthy—and they often use this wealth to benefit others.

  
  
  
• Health Care
  

  State Health Reform: Converting Medicaid Dollars into Premium Assistance

  By Dennis G. Smith, The Heritage Foundation
  
  Backgrounder, 09/22/2008
  

  States have the capability to increase the value of Medicaid for recipients and taxpayers alike through premium assistance. Linking public dollars to private coverage would increase access to needed services for recipients and reduce costs for taxpayers. Coverage for a family of three on Medicaid (one adult and two children) will cost $9,830 next year. In most states, this is likely to be significantly higher than the average annual premium for family coverage in the private market. Using Medicaid dollars to pay the employee share of employer-sponsored insurance would also stretch public dollars.