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InsiderOnline Blog: January 2015

Henry Manne, R.I.P.

Henry Manne, a pioneer of using economics to analyze law, died last Saturday at 86. The George Mason University School of Law, where he served as dean from 1986 to 1997, calls Manne one of the four founders of the Law & Economics academic movement:

Throughout his career Henry Manne’s writings originated, developed or anticipated an extraordinary range of ideas and themes that have animated the past forty years of law and economics scholarship. For his work, Manne was named a Life Member of the American Law and Economics Association and, along with Nobel Laureate Ronald Coase, and federal appeals court judges Richard Posner and Guido Calabresi, one of the four Founders of Law and Economics.

In the 1950s and 60s Manne pioneered the application of economic principles to the study of corporations and corporate law, authoring seminal articles that transformed the field. His article, “Mergers and the Market for Corporate Control,” published in 1965, is credited with opening the field of corporate law to economic analysis and with anticipating what has come to be known as the Efficient Market Hypothesis (for which economist Eugene Fama was awarded the Nobel Prize in 2013). Manne’s 1966 book, Insider Trading and the Stock Market was the first scholarly work to challenge the logic of insider trading laws, and remains the most influential book on the subject today.

While at Rochester, in 1971, Manne created the “Economics Institute for Law Professors,” in which, for the first time, law professors were offered intensive instruction in microeconomics with the aim of incorporating economics into legal analysis and theory. The Economics Institute was later moved to the University of Miami when Manne founded the Law &Economics Center there in 1974. While at Miami, Manne also began the John M. Olin Fellows Program in Law and Economics, which provided generous scholarships for professional economists to earn a law degree. That program (and its subsequent iterations) has gone on to produce dozens of professors of law and economics, as well as leading lawyers and influential government officials.

The creation of the Law & Economics Center (which subsequently moved to Emory University and then to George Mason Law School, where it continues today), was one of the foundational events in the Law and Economics Movement. Of particular importance to the development of US jurisprudence, its offerings were expanded to include economics courses for federal judges. At its peak a third of the federal bench and four members of the Supreme Court had attended at least one of its programs, and every major law school in the country today counts at least one law and economics scholar among its faculty. Nearly every legal field has been influenced by its scholarship and teaching. […]

Throughout his career, Manne was an outspoken champion of free markets and liberty. His intellectual heroes and intellectual peers were classical liberal economists like Friedrich Hayek, Ludwig Mises, Armen Alchian and Harold Demsetz, and these scholars deeply influenced his thinking. As economist Donald Boudreax said of Dean Manne, “I think what Henry saw in Alchian – and what Henry’s own admirers saw in Henry – was the reality that each unfailingly understood that competition in human affairs is an intrepid force…” [Law and Economics Center at the George Mason University School of Law, January 17]

Posted on 01/24/15 12:28 AM by Alex Adrianson

To Do: Get Into the Movement for School Choice

Show your support for school choice. This week is National School Choice Week, and there are over 11,000 events around the country where people will be talking about, learning about, and showing their support for choice in education. We’re showing our support for school choice by running a 5k today (January 24) at 1 p.m. at American University in Washington, D.C. Feel free to join the Run for School Choice, or, if you prefer, attend a warmer event. You can search for an event near you at the National School Choice Week website.

Find out who’s economically free and who isn’t. Most importantly, find out how much economic freedom matters for prosperity. The Heritage Foundation will release the 2015 Index of Economic Freedom at 10:30 a.m. on January 27 at its headquarters in Washington, D.C. Rep. Paul Ryan (R-Wis.) will be among the speakers.

Learn whether we can end poverty. The Cato Institute will host a half-day conference at Columbia University to discuss what our 51-year War on Poverty has accomplished and whether private efforts could do a better job. The discussion will begin at 8:30 a.m. on January 29.

Pay tribute to John Blundell. The former Director General of the Institute of Economic Affairs died in July of 2014. IEA will host a memorial at which friends and allies on both sides of the Atlantic will remember Blundell’s work and contributions for liberty. The memorial will begin at 6:30 p.m. on January 28 at IEA’s headquarters in London.

Examine the opportunities for promoting free trade in 2015. Sen. Orin Hatch (R-Utah) will speak at the American Enterprise Institute to outline his vision of a free trade agenda. The talk will begin at 9 a.m. on January 30.

Posted on 01/23/15 10:50 PM by Alex Adrianson

Having Little Wealth Is Not the Same as Living in Poverty

Oxfam released a report this week finding that 1 percent of the world owns half of all the world’s wealth. At first, that may sound like a statistic showing there is terrible economic inequality—until you pause to note that Oxfam is talking about wealth, not income. As Tim Worstall explains, wealth distribution is a misleading indicator of people’s economic circumstances:

For it’s possible to have negative wealth: more debt than the value of whatever it is that you own. Like just about every student who graduates from college with a bit of tuition debt for example. And this means that the bottom part of any wealth distribution simply don’t have very much, if anything. […] If you’ve no debts and have $10 in your pocket you have more wealth than 25% of Americans. More than that 25% of Americans have collectively that is. […]

The actual number you need to be in that 1% is just under $800,000. And that’s the value of any equity you might have in a home, any savings and also your pension pot. So, anyone that owns a home in England (without a mortgage that is) and has a reasonable pension will be in that 1%. And anyone who owns a flat in London will almost certainly be in it. A house in Oxford, where Oxfam is based, would also qualify you. There’s only a bit over 5,000 people who work for Oxfam UK and I certainly don’t insist that all of them own their own homes free and clear. But if we add in the people at the other Oxfam organisations, those in other rich world countries like Canada, the US, France and Australia, then yes, I think we probably would find a couple of thousand people who made it into that global 1% by wealth.

And as this magazine points out, there’s only 1,645 billionaires in the world. So, no, I don’t insist that this is true only that it is probably true. There’s probably more of those global one percenters working for Oxfam than there are billionaires in the world. [Forbes, January 22]

Ben Southwood makes the same point this way: “Oxfam’s figures look at net wealth, implying that Societe Generale rogue investment banker Jerome Kerviel is the world’s poorest person, and Michael Jackson was afflicted by the direst poverty before he died.” Looking at how much more people have to live on today than they did three decades ago tells a different and more positive story, explains Southwood:

Global poverty has actually fallen enormously with the rise of global capitalism. The fraction of the world’s population living on less than $2 a day (measured in constant dollars) has crashed from 69.6 per cent in 1981 to 43 per cent today.

Even if you take out India and China, where the most spectacular improvements have been made, and look only at Sub-Saharan Africa, the worst-off region, there have been improvements. From 1981-2006 8.6 percentage points fewer were living on under $1 a day and 4.9 percentage points fewer were living on under $2 a day. [Adam Smith Institute, January 21]

Posted on 01/23/15 09:12 PM by Alex Adrianson

The State of Liberty in Argentina

As the scandal over the shooting of Alberto Nisman unfolds, we ask Alejandro Chafuen about the circumstances facing the pro-liberty movement in the country. Chafuen, a U.S. citizen who was born in Argentina, is the head of the Atlas Network, a nonprofit that supports the work of classical liberal think tanks and organizations around the world. Many of those groups operate in very difficult political environments.

InsiderOnline: What can you tell us about how Argentinian pro-liberty activists and organizations are responding to the crisis in their country?

Alejandro Chafuen: Argentine pro-liberty activists respond with a sense of awe and impotence. Unfortunately, many Argentine pro-liberty activists are divided and have been speaking mostly to themselves or to their foreign freedom activists, like you and me, rather than to their neighbors. So they do not have much political weight. Two exceptions are Agustin Etchebarne, leader of the think tank Libertad y Progreso, and Marcos Hilding Ohlsson, a city councilman in the San Isidro district. They have been marching and denouncing what is going on; most important, they are inclusive and strategic in their efforts. When the death of the prosecutor was announced, some of my friends at first were pointing at a potential cover-up, even accusing the main opposition leader, Mauricio Macri, who is head of the government of the city of Buenos Aires. Now there is a sense that the only ones who deserve major blame and scrutiny is the current national government and its Iranian allies.

IO: What should the Argentinian pro-liberty movement do now?

AC: We should be ruthless in exposing those who “deal with the devil.” There are always a sufficient number of multinationals and crony capitalists lining up to do business with crooked governments. And we should not speak with general statements; we should name names. In Argentina, for every Shell, whose CEO has consistently defied the government, there are many Chevrons, ready to do business with the government. Argentines now have proof about how their government and the Iranians play a double game—one “official” pour la gallerie, and the other, behind the table.

In the short term we should make a push for exposure and transparency, and seek independent investigations and removal of those responsible; but as culpability reaches the president, it will not be easy. I do not think they have the votes for impeachment. In the medium and long term, they will have to work better to build consensus seeking more internal and external allies.

It is amazing that coincidently the Obama administration is trying to cozy up to Iran and to oppose the sanctions recommended by the Congress. It gives Argentine pro-liberty activists the image that the United States is beginning to suffer from the same double speak and hypocrisy as Argentina.

IO: What can those outside the country do to help?

AC: Many international bodies are run by the representatives of crooked governments; some of us, especially those gathered at the Fundación Internacional para la Libertad (International Freedom Foundation) headed by Nobel Laureate Mario Vargas Llosa, have been drafting plans to create a shadow international court that would help tell the world how honorable and learned civilized leaders see the abuses—and not only in Argentina, but in Cuba, Venezuela, and the rest of the Americas. We need something similar for the world. Bodies such as the Organization of American States, the United Nations, and the World Economic Forum have failed to promote transparency.

We have many, many political prisoners in Latin America. I have written about Leopóldo López and the courageous Venezuelan students. I have also written about how CEDICE continues to work for freedom in Venezuela despite a terrible environment and constant threats. International support from pro-liberty groups in the United States is essential. It helps strengthen not only the ideas but even the spiritual drive of pro-liberty activists.

Posted on 01/23/15 08:37 PM by Alex Adrianson

Who Shot Alberto Nisman?

On Monday, the General Prosecutor of Argentina had been due to present to the Argentine Congress evidence that the government of Christina Fernandez de Kirchner had conspired to help Iran cover up its involvement in the 1994 bombing of a Jewish cultural center in Buenos Aires. Instead, he was shot to death in his apartment on Sunday.

There was no suicide note, and no gunpowder residue on Nisman’s hands. Also, he didn’t own the gun with which he was shot. If it wasn’t suicide, who shot Nisman? Aside from the Argentine government itself, writes Joseph Humire, the most likely culprit is Iran:

For years, five of Iran’s high-ranking military officers, clerics and politicians have been forbidden to travel because an Interpol red notice requires they appear before an Argentine judiciary for their role in the AMIA attack. In a 2011 incident, the former Iranian Defense Minister, Gen.Ahmad Vahidi, made a hasty exit from Bolivia to escape extradition once the Argentine authorities notified Interpol that the Iranian general had illegally left his homeland. In another incident, a trip to South Korea was cancelled for fear of extradition. These Interpol red notices are an embarrassment for Iran, directly affecting some powerful individuals, including two recent 2013 presidential candidates of the Islamic Republic.

Much like its secret negotiations with the White House predating the Geneva interim agreement, Iran also created back-door channels to Argentina in an effort to sway the Fernández de Kirchner regime into their geopolitical orbit.

Fortunately for the Ayatollahs, Argentina’s dire economic situation, particularly its annual $7 billion energy deficit, nudged them in that direction. In what was described as an oil-for-grain scheme, the Iranian government decided to curry favor for Argentina only if the Fernández de Kirchner regime could remove the Interpol red notices on their accused. According to Nisman, this was Iran’s main sticking point in signing a controversial agreement with the Fernández de Kirchner government to reinvestigate the AMIA case, which ultimately led to the prosecutor’s death.

Nisman knew that to get Iran to face justice, he would have to force their hand. Herein lies the importance of his most recent work. In sifting through the voluminous pages of Nisman’s formal accusation against Fernández de Kirchner and her cronies, one comes to realize that a strategic shift is taking place on the AMIA case. What had historically been an Argentine judicial case prosecuted under the country’s anti-terrorism laws was now morphing into a criminal case potentially taken to an international court. […]

As Iran tries cleaning up its international image and alleviating economic pressure from international sanctions, Nisman was about to cause them a significant setback potentially costing the regime billions of dollars. [Breitbart, January 23]

On Monday, the day Nisman was supposed to testify but didn’t because he was dead, President Barack Obama gave a state of the union address in which he said he would veto any new sanctions bill that threatens to undo progress with Iran.

Posted on 01/23/15 08:20 PM by Alex Adrianson

Planned Parenthood’s Dark History of Eugenics

In May of 1926, Planned Parenthood founder Margaret Sanger met with the ladies of the Ku Klux Klan’s branch in Silver Lake, New Jersey for a chat. Sanger herself told the story in her autobiography, as Paul Kengor notes, making it clear that the rendezvous in “a large, unpainted, barnish building” somewhere down a lonely lane through the New Jersey woods was not an accidental run-in with white supremacists. Kenger continues:

One might ask, why would the KKK be so interested in Ms. Sanger? The reasons are obvious, a natural fit.

Sanger was a passionate racial-eugenicist with a crowning vision for what she openly called “race improvement.” The Planned Parenthood founder lamented America’s “race of degenerates.” The nation’s landscape needed to be purged of its “human weeds” and “the dead weight of human waste.” This included the “feeble-minded,” the “insane,” and the just plain “idiots.” Sanger shared the disparaging view of humanity held by another progressive icon, Supreme Court Justice Oliver Wendell Holmes, who declared that “Three generations of imbeciles are enough.” Like Holmes, and, for that matter, like Adolf Hitler—who was an obviously more aggressive racial-eugenicist—Sanger hoped to finesse and refine the “gene pool.” She would do so not with gas chambers and concentration camps but with birth-control pills, eliminating human life before conception rather than after birth. Thus, her Planned Parenthood, which was originally called the American Birth Control League.

One of Sanger’s favorite slogans, so much so that it adorned the masthead of her Birth Control Review, was this: “Birth Control: To Create a Race of Thoroughbreds.”

In this Sangerian vision, blacks were singled out.

Progressives today dare not raise the alarming specter of Sanger’s “Negro Project,” or her correspondence with Dr. Clarence Gamble, one of her Negro Project collaborators. In a remarkable December 10, 1939 letter today held in the Sanger archives at Smith College (I have a photocopy), Sanger urged Gamble: “We do not want word to go out that we want to exterminate the Negro population.” [The American Spectator, January 22]

Posted on 01/23/15 04:44 PM by Alex Adrianson

The Pro-Life Movement Is Making Gains

Reports Michael J. New:

This past December, the CDC released abortion numbers for the year 2011. The CDC’s figures indicated that among states consistently reporting data, the number of abortions fell by 4.6 percent between 2010 and 2011. This is consistent with the long term decline in the number of abortions performed since 1990. […] And the 2011 decline is fairly consistent among states, so it’s unlikely that it was caused by yearly idiosyncrasies or changes in reporting requirements. In fact, the number of abortions fell in 42 of the 46 states that released data in both 2010 and 2011.

Why are abortion numbers falling? Pro-life legislation is playing a role. This past September, State Politics and Policy released a study of mine which shows that a range of state-level pro-life laws have resulted in lower abortion rates. But abortion numbers are falling everywhereeven in states that have not been active in passing pro-life legislation. Many credit contraception, but despite increased contraceptive use, the unintended pregnancy rate has remained fairly constant over the long term. Much of the decline is due to the fact that a higher percentage of women with unintended pregnancies are carrying them to term.

What bodes especially well for the future is that the abortion rate among pregnant minors has fallen faster than the overall rate. Since repeat abortions make up a significant fraction of abortions, this decline among teens likely predicts future abortion declines. Interestingly, social scientists have struggled to provide a definitive explanation for the decline in teen abortions. There is good evidence from both Guttmacher and the CDC that teen sexual activity is declining. [National Review, January 22]

Posted on 01/23/15 04:17 PM by Alex Adrianson

How to Get Back to Self Government

James Buckley, who represented New York in the United States Senate from 1971 to 1977, has an idea that could radically transform how we govern ourselves: Eliminate all federal grants-in-aid to the states. As Buckley points out, not only would such a reform cut out a lot of silly spending at the federal level, it would free the states to decide what their own spending priorities are and thus make them more accountable to their own citizens.

Posted on 01/23/15 03:35 PM by Alex Adrianson

Toolkit: How to Ask a Great Question at a Town Hall Meeting

Some advice to put into practice from Generation Opportunity’s “Training Guide: How to Be Effective at a Town Hall Meeting”:

Pick the Issue of Greatest Concern to You. After you have done your research, narrow down the question you want to ask to a single question – and then have a follow-up question prepared. Oftentimes, town hall meetings can be frustrating to attendees and officials because a single question can really mask four or five questions and the official, pressed for time, may only answer one. This leads many citizens to feel as though the official is not responsive, when in fact they were just trying to decipher, not dodge, multiple questions and potential answers. You have a direct role in the quality of your answer you receive – don’t miss the opportunity to keep the question focused and relevant.

Write Out Your Question and Practice. This may sound simple – but it is important. Writing out your question and practicing it will help you prepare for the meeting, especially if the meeting is well attended and you are listening intently. Through practice, you will be set to respectfully pose your question, regardless of the size of the event or the media coverage.

Introduce Yourself – Then Ask the Question: When it is your turn to pose the question, remember to properly address the official instead of using a first-name or any other name. The use of title reflects your level of respect for the institution and the office they represent or hold, regardless of whether you disagree with their point of view or record. Start your question by clearly stating your name and where you are from and why you are attending the event. This information will provide important context for the official and allow them to address you directly by name in return.

Crowd Reaction: Some issues discussed at town hall meetings can result in a highly charged environment, to the point that even asking a question may invite positive or negative comments about you or your question. Unfortunately, not everyone may approach a conversation with an elected or appointed official with same level of civility or decorum as you do. The best thing to do is to ignore comments and carefully focus on your question, regardless of the crowd reaction or the reaction of those around you. The official will more than likely be trying just as hard to listen and be responsive to you, so stay on focus and ignore side comments.

Posted on 01/22/15 06:20 PM by Alex Adrianson

Resources for Learning Liberty: Free Your Mind

Last week, at the Asia Liberty Forum in Kathmandu, Sauvik Chakraverti was honored as one of the champions of liberty the world has lost over the past year. Chakraverti was a New Delhi-based writer and lecturer who won the inaugural Frederic Bastiat award in 2002 for his writings promoting the institutions of a free society. In particular, his Free Your Mind: A Beginner’s Guide to Political Economy is a highly regarded primer on classical liberal ideas that have influence many students.

You can find that book in the books section at the Center for Civil Society’s website, which by the way, has many other worthy offerings.

Posted on 01/22/15 05:26 PM by Alex Adrianson

Enjoy Your Plastic!

Bisphenol-A, the plastic component that environmental activists allege interferes with the human reproductive system, poses no consumer health risk, says a new analysis by the European Food Safety Authority:

EFSA’s comprehensive re-evaluation of bisphenol A (BPA) exposure and toxicity concludes that BPA poses no health risk to consumers of any age group (including unborn children, infants and adolescents) at current exposure levels. Exposure from the diet or from a combination of sources (diet, dust, cosmetics and thermal paper) is considerably under the safe level (the “tolerable daily intake” or TDI). [European Food Safety Authority, January 21]

Ron Bailey notes that the hyper-cautious EFSA is catching up with previously analyses on so-called endocrine disruptors:

In December 2013, a comprehensive review of low-dose endocrine disruptors by researchers published in Toxicology Letters tartly concluded:

Taking into account the large resources spent on this topic, one should expect that, in the meantime, some EDs [endocrine disruptors] that cause actual human injury or disease should have been identified. However, this is not the case. To date, with the exception of natural or synthetic hormones [e.g., contraceptive pills and DES], not a single, man-made chemical ED has been identified that poses an identifiable, measurable risk to human health (the adverse effects of iatrogenic DES were long known before the term endocrine disruptor was coined). Certainly, there has been much media hype about imaginary health risks from bisphenol A, parabens or phthalates. However, no actual evidence of adverse human health effects from these substances has ever been established. To the contrary, there is increasing evidence that their health risks are absent or negligible – or imaginary.

Given that there is essentially no evidence for the ubiquity of low-dose endocrine disruption, why is it still an issue for activists? The researchers note:

The hypothesis of and subsequent search for man-made (synthetic), chemical EDs in the environment, food or personal care products began in the early 1990s. Up to date, this research has spent hundreds of millions of Euros or Dollars of tax payer’s money. In the EU alone, more than 150 million Euros have been spent on research into potential health risks of EDCs (Jensen and van Vliet, 2012). Given this large amount of research funding there may also be a vested interest of scientists in the ED field to keep the ED hypothesis on the agenda in order to stay in business. [Reason, January 21]

Plastics makers have been using Bisphenol S in order to be able to say their products are “BPA free.” Can you guess what chemical might be the next target of environmental alarmism? Bisphenol S, of course! Josh Bloom of the American Council on Science and Health explains:

[See also: “The Science of the ‘Endocrine Disrupter’ Debate,” by Angela Logomasini, Independent Women’s Forum, January 2015.]

Posted on 01/21/15 06:22 PM by Alex Adrianson

Higher Capital Gains Taxes Mean Less Investment Which Means Lower Wage Growth

[Image from David Weil’s textbook, Economic Growth, h/t Dan Mitchell at International Liberty, January 20]

The graphic above, as Dan Mitchell explains, tells us what’s wrong with President Obama’s idea of increasing taxes on capital gains:

The clear message is that workers earn more when there is more capital, which should be a common-sense observation. After all, workers with lots of machines, technology, and equipment obviously will be more productive (i.e., produce more per hour worked) than workers who don’t have access to capital.

And in the long run, worker compensation is tied to productivity.

This is why the President’s class-warfare proposals to increase capital gains tax rates, along with other proposals to increase the tax burden on saving and investment, are so pernicious.

The White House claims that the “rich” will bear the burden of the new taxes on capital, but the net effect will be to discourage capital investment, which means workers will be less productive and earn less income. [International Liberty, January 20]

Posted on 01/20/15 05:35 PM by Alex Adrianson

To Do: March for Life

Show your support for the rights of the unborn. The 2015 March for Life will begin at noon on January 22 with a rally on the National Mall and 12th Street, Washington, D.C.

Learn how to make a difference for life.  The Family Research Council will host activists, policy experts, and legislators for discussions of the opportunities to advance life in 2015. ProLifeCon 2015 will begin at 8:30 a.m. on January 22.

Find out how we can support the value and dignity of the lives of children diagnosed with severe diseases such as Down Syndrome, Trisomy 18, and Spina Bifida. A panel hosted by The Heritage Foundation and the National Review Institute will examine the medical advances in caring for children with these diseases, the resources available to parents of these children, and what policymakers can do to help. The discussion will begin at noon on January 20 at The Heritage Foundation.

Secure you chance to learn how to make films for liberty. The Freedom on The Big Screen: Communicating Liberty Through Film program will give you practical advice from experienced professionals on how to craft inspiring narratives and how to break into the film industry. The seminar, a program of the Motion Picture Institute and the Foundation for Economic Education, will be held March 13-15 in Los Angeles. Get your applications in by February 13. Acceptance to the seminar gives you a chance to win a $5,000 filmmaking grant.

Nominate examples of crony capitalism for the Atlas Shrugged Crony Awards. If one of your examples is selected in the crony election, you could win prizes, including a trip to the 2015 Atlas Summit. Be sure to make your nominations by February 15.

Examine the state of free speech in the world today. Fleming Rose, the editor of the Danish newspaper that published cartoons of the prophet Mohammad in 2005; Harvey Silverglate of the Foundation for Individual Rights in Education; Jeff Jacoby of the Boston Globe; and Onkar Ghate of the Ayn Rand Institute will discuss hate speech, Islamophobia, trigger warnings, bullying regimes, and more. The discussion will be held at the Old South Meeting House in Boston, Mass., at 6 p.m. on January 21.

Explore the connection between reason and morality. The Cato Institute will host Michael Shermer discussing his new book, The Moral Arc: How Science and Reason Lead Humanity toward Truth, Justice, and Freedom. Shermer will speak at noon on January 21.

Students, get that Heritage internship application done. The deadline for applying for a summer internship at The Heritage Foundation is February 1.

Get ready for National School Choice Week. Eleven thousand events in support of school choice will be held sometime during the week of January 25. So pick one and put it on your calendar.

Posted on 01/17/15 02:17 AM by Alex Adrianson

The Voices of Their Generations

Martin Luther King, Jr., 1957:

And this is what Jesus means when he said: “How is it that you can see the mote in your brother’s eye and not see the beam in your own eye?” Or to put it in Moffatt’s translation: “How is it that you see the splinter in your brother’s eye and fail to see the plank in your own eye?” And this is one of the tragedies of human nature. So we begin to love our enemies and love those persons that hate us whether in collective life or individual life by looking at ourselves. A second thing that an individual must do in seeking to love his enemy is to discover the element of good in his enemy, and every time you begin to hate that person and think of hating that person, realize that there is some good there and look at those good points which will over-balance the bad points. [Sermon at Dexter Avenue Baptist Church, Montgomery, Alabama, November 17, 1957]

Lena Dunham, 2015:

I don’t care what conservative white men think about me, but I do care if anything I write is painful for survivors of sexual abuse, if anything I write is painful for … other feminists … The difference between not caring about what your sort of enemy party thinks of you and caring about how you affect people whose values line up with yours is very vast. [Interview with Bill Simmons at Grantland, January 14, 2015, as quoted by Newsbusters, January 14, 2015]

Posted on 01/17/15 12:04 AM by Alex Adrianson

Nothing’s Been Fixed Yet in the Federal Budget

Fixing the federal government’s finances requires keeping our eyes on the ball beyond the annual appropriations process. That is to say, as Alison Acosta Fraser points out, the long-term problem is still entitlements:

[This year’s] $483 billion deficit, is projected to return to $1 trillion levels in as little as seven years. The biggest budget problem is mandatory spending—fueled by entitlements and interest—which will drive annual spending up by $2 trillion to nearly $6 trillion in a decade. […]

[E]ntitlement programs—Social Security, Medicare, Medicaid and the ACA subsidies—are the largest drivers of spending and debt. These programs provide retirement and health benefits for the nation’s seniors, while Medicaid and the ACA subsidies also provide health benefits for low- and medium-income recipients. In a generation, spending on these programs will grow from about 10 percent of GDP to nearly 15 percent. Adding in interest payments, which will triple from 1.3 percent of GDP to 4.7 percent of GDP, this spending alone will reach 19 percent of GDP by 2039. This is huge. Total federal spending averaged 20 percent of GDP from the post–World War II period until the great recession. In terms of growth or sheer size, retirement- and health-related federal spending plus interest on the debt will consume ever more of the federal budget, while the federal budget itself takes a bigger and bigger bite out of the economy.

And some surprising perspective on how big the problem is:

[W]hen Detroit entered bankruptcy in July, 2013, its total debt was estimated at $18 billion. Half of that—$9.2 billion—was from future unfunded pension and retiree health-care costs. While U.S. debt held by the public was nearly $12 trillion at the time of Detroit’s bankruptcy, similar retirement obligations were far, far larger. Federal employee and military retirement benefits, along with unfunded benefit costs from Social Security and Medicare (remember, these programs are not truly budgeted) were nearly $54 trillion. Because these obligations are paid in the future, they are not counted in debt measures. And, while the federal debt alone is worrisome enough, the federal government’s fiscal exposure from retirement and health costs is 4.5 times larger. Put differently, when Detroit filed for bankruptcy, the city’s obligations were nearly $27,000 per capita. The federal government’s were $218,000. [National Interest, January 14]

Posted on 01/16/15 11:00 PM by Alex Adrianson

Holder Gets Something Right: Your Property Is Slightly Safer Today

Theft by police could become a little rarer after a Friday announcement by the U.S. Attorney General. By “theft,” of course, we mean the legal larceny of cops seizing assets suspected of being connected to a crime without actually having to prove that the assets were connected or that the owner of the property was in any way culpable. Eric Holder announced a significant scaling back of a federal program called Equitable Sharing that incentivized the practice of civil asset forfeiture. The Institute for Justice explains how civil forfeiture works in this video:

Radley Balko describes Holder’s action this way:

The program won’t end civil asset forfeiture abuses entirely, but it will stop local police agencies from circumventing state laws aimed at reining them in. Many states, for example, have imposed stricter evidentiary standards police have to meet before they’re allowed to seize assets without a conviction. Other states have tried to eliminate the incentive problems that arise when police are allowed to keep the proceeds from asset forfeiture by requiring those proceeds to be sent to a general fund, or to a schools fund. Local police agencies have been able to get around those laws through the equitable sharing program, which basically federalizes investigations solely for the purpose of letting local police departments and prosecutors keep the bounties they collect in these cases.

The reform, however, isn’t a complete bar on federalizing local investigations, as Balko explains:

Basically, they still enable local authorities to take an investigation federal if they’re really determined to do so. It just requires them to get active participation from a federal law enforcement official. As a whole, then, the new policy doesn’t eliminate equitable sharing so much as puts some roadblocks in front of local law enforcement before they can use it. But those roadblocks aren’t insignificant. [Washington Post, January 16]

Posted on 01/16/15 10:35 PM by Alex Adrianson

The Economy Won’t Work for Everybody Until We Apply the Rules to Everybody

Here is a program all Americans should be able to get behind: “Opportunity for All, Favoritism for None.” That’s the title of a new Heritage Foundation/Heritage Action for America publication that lays out recommendations in 12 different policy areas.

What these recommendations have in common is a recognition that government is too often merely a device for limiting competition—picking winners and losers, denying opportunity, and frustrating those with new ideas. Examples of this practice are too-big-fail regulations that entrench big banks, green energy subsidies for politically connected firms, occupational licensing that limits the number of people who can enter a profession, federal education funding that flows to districts and schools instead of students, and so on. Sen. Jim DeMint describes the recommendations this way:

The policy solutions contained within this book envision an America where the sweetheart deals are shattered and the smoke filled rooms are blown clear.

We propose free and fair energy markets that offer high wages and low prices. A health care market that replaces government control and massive subsidies with choice and competition. A labor market that matches skills to jobs without forcing working Americans to jump through hoops for unions that don’t serve their interests.

All Americans, particularly families and small businesses, deserve a fair tax code that serves the interests of the people rather than special interests practiced in winning carve outs. It must be paired with an end to the “too big to fail” mindset that brought our economy to the brink and prioritized the interests of Wall Street over the needs of Main Street. This cannot be accomplished without a tamed regulatory state that no longer operates as an unaccountable fourth branch of government. Law is to be made by our elected, accountable representatives, not appointed bureaucrats.

We demand an education system that restores dollars and decisions to parents, teachers, and communities, and once and for all rejects the fallacy that centralized education is good for this country. We strive for a higher education market that gives students affordable access to the courses they need rather than committing them to a future of debt in the service of a bloated, over-subsidized university system.

Our cover story in the latest issue of The Insider, written by Sen. Mike Lee (Utah) sounds a similar theme, explaining how crony capitalism undermines both opportunity and economic growth:

It empowers and enriches the few by disenfranchising the many. Like a black hole, cronyism bends the economy toward the state, inexorably shifting wealth and opportunity from the public to policymakers.

The more power government amasses, the more privileges are bestowed on the government’s friends, the more businesses invest in influence instead of innovation, the more advantages accrue to the biggest special interests with the most to spend on politics and the most to lose from fair competition.

Once profits depend on serving congressmen instead of customers, the interests of the elite diverge from those of the nation. Innovation slows, and true inequality—inequality of opportunity—emerges. The American people are forced to work for big businesses instead of the other way around. The middle class falls and the middle-men rise.

Far from the rivals of popular mythology, the elite leaders of Big Government, Big Business, and Big Special Interests are more often than not partners, in collusion to help each other climb to the highest rungs of success, and then pull up the ladder behind them.

To be clear, the problem I’m describing is not that there is too much money in politics. It’s that there’s too much politics in the economy: three and a half trillion dollars in direct federal spending, and almost $2 trillion more redirected through regulations.

What we have today is a warped economy increasingly built on connections instead of competitiveness. Record corporate profits and jaw-dropping gains among elites, but slow growth, stagnant wages, and limited opportunities for everyone else. Except, of course, in the Washington, D.C., area, home to six of the ten wealthiest counties in the United States. [“Can We Save the American Dream,” by Sen. Mike Lee, The Insider, Winter 2015]

And, by the way, Heritage hosted a two-day conference highlighting the ideas in this book. You can catch those sessions online [Day 1, Day 2].

Posted on 01/16/15 10:03 PM by Alex Adrianson

Walter Berns, R.I.P.

Walter Berns, a scholar of constitutional law and the American Founding, died on Monday at the age of 95. Jeremy Rabkin remembers Berns as a “gentleman patriot” who taught many young students “to appreciate the something more that a flourishing nation requires.”

What he learned from Leo Strauss was that the principles of the American Revolution had not seemed at all “self-evident” to earlier thinkers. Before the seventeenth century, the tradition of political philosophy, stretching back to Plato and Aristotle, would scarcely have recognized America’s founding doctrines as political principles. What Berns also saw, however—without prompting from any books or teachers—was that America was a boon to its own people and a great force for good in the world. His academic career was in some way an effort to reconcile these two understandings. He appreciated that liberty is—as the preamble to the Constitution says—“a blessing.” But he also came to appreciate that, even if God-given, freedom is not simply a spontaneous growth: It can’t be expected to continue without reflection, without effort, without commitment to preserve and defend it.

The different phases of his scholarship reflect an underlying purpose, when seen in this light. In the 1950s and ’60s, he criticized the Supreme Court for an approach to free speech that disregarded the rightful claims of civility and decency. In the 1970s and ’80s, he attacked a judicial activism that seemed to have no anchor in the actual Constitution. So in Freedom, Virtue and the First Amendment (1957, 1965) he urged the Court to pay heed to lessons of premodern political thought. In The First Amendment and the Future of American Democracy (1976, 1985) he condemned the Court for transforming constitutional dispute into an open-ended symposium and forgetting that the point of the Constitution was to place some conflicts outside the range of political debate so the rest could be settled by open debate and political compromise. [Weekly Standard, January 26]

You can learn more about Walter Berns at walterberns.org.

Posted on 01/16/15 06:14 PM by Alex Adrianson

Harry Jaffa, R.I.P.

Lincoln scholar and political philosopher Harry Jaffa died Monday. He was 96. Jaffa’s scholarship, in particular Crisis of the House Divided: An Interpretation of the Issues in the Lincoln-Douglas Debates (1959), provoked a number of important debates within the conservative movement, some of which continue today. Walter Kesler writes about Jaffa’s influence on several of those debates, including how conservatives should regard Abraham Lincoln:

Across several decades in National Review and other journals, Jaffa and his opponents, who included at various times Willmoore Kendall, Frank Meyer, and Mel Bradford, clashed repeatedly and, on the whole, courteously. The issue was whether Lincoln saved the American republic or ruined it by stressing “that all men are created equal,” that slavery was wrong, and that a civil war should be fought rather than tolerate the extension and legitimation of slavery and the breakup of the Union. Although he never quite believed it, Jaffa’s arguments in defense of Lincoln changed the conservative mind.

Another important debate in which Jaffa played a leading role, writes Kesler, “took place with ex-friends, mostly fellow students of Strauss like Martin Diamond and Walter Berns (who died on the same day as Harry) or neoconservatives influenced by Strauss, like Irving Kristol.”

Two questions stood at the center: the relation between theory and practice, that is, between philosophy and morality; and the status of America, whether it was, as his opponents (who came to be called East Coast Straussians) held, essentially a modern regime founded on “solid but low” principles, or, as Jaffa (and his allies, the West Coast Straussians) maintained, was something nobler, and meant by its founders to be nobler.

The controversy drove both sides to new research and deeper thinking, which benefited the whole conservative movement. Jaffa did not achieve the knockout he did against the neo-Confederates, but he won on points, at least in the eyes of this judge. One does not hear the argument that America is a thoroughly self-interested or Hobbesian enterprise so much any more, partly because both sides agree that “low” does not prove very “solid” in the long run, and partly because Harry forced everyone to consider a broader swath of evidence, ranging from the state constitutions, bills of rights, and statutes to the effects of Christianity on politics.

A spinoff of this debate turned into a fourth donnybrook between Jaffa and the judges William Rehnquist, Robert Bork, and Antonin Scalia, conservative stalwarts all, whom he criticized as legal positivists (i.e., relativists) or naked majoritarians, distrustful of the natural rights and natural law principles inherent in the Constitution. Bork and Scalia pled guilty as charged, essentially, but with the extenuating circumstance that as judges their commission was properly to keep to the positive law. [The Federalist, January 16]

Posted on 01/16/15 05:43 PM by Alex Adrianson

Road Signs or Campaign Signs?

Have you ever wondered why some states put the name of their governor on their welcome signs at the state line? As Tom Firey points out, it’s almost certainly because the governor wants people to know his name. But spending money to promote the governor isn’t really a public purpose to which public funds should be devoted.

Firey also observes that incoming Maryland governor Larry Hogan has an opportunity to end the practice by ordering that the old “Martin O’Mally/Governor” signs be removed but not replaced. That move would signal Hogan’s commitment to using Maryland tax dollars wisely:

The real value of the placard order would not be the monetary savings, but the moral benefit of Hogan’s signaling that he will not join in a small but corrupt political practice: using state money and resources for personal promotion.

Maryland’s tradition of putting the governor’s name on roadway signs began, I believe, with William Donald Schaefer, the state’s 58th governor. Previously, as Baltimore mayor, Schaefer plastered his name all over city property: on road signs, park benches, trash cans, and bus shelters. One of his staffers once told me the practice was intended to show Schaefer’s taking responsibility for that property, but of course that explanation was nonsense. The real purpose was to promote the Schaefer political brand, at public expense. And it worked brilliantly; every signpost and park bench became a highly visible campaign sign. When Schaefer moved from Baltimore to Annapolis, he took the practice statewide.

Maryland’s three subsequent governors—Democrats Parris Glendening and Martin O’Malley, and Republican Bob Ehrlich—subsequently adopted the practice. New signs went up and new public expenditures were made each time there was a change in Government House. [Maryland Public Policy Institute, January 15]

We’ve driven across a few state lines ourselves, and have noticed that Maryland isn’t the only state that spends money to promote the governor. Does your state do it, too?

Posted on 01/15/15 05:29 PM by Alex Adrianson

Two Minutes on Adam Smith, Set to Guitar

This video, by Lopsang Dorje, won first place in “Expressing Ideas for a Free Society” at the Asia Liberty Forum last week.

Posted on 01/15/15 03:37 PM by Alex Adrianson

The Federal Government Doesn’t Care Very Much about Health Care Fraud

In fiscal year 2013, says the Office of Management of Budget in a recent report, federal programs made $106 billion in improper payments, of which Medicare accounts for $36 billion. [“High Error Programs,” PaymentAccuracy.gov, December 12, 2014]

Veronique de Rugy and Jason Fichtner put those findings in a graph:

[Mercatus Center, January 13]

De Rugy explains in a related post at Reason that politicians don’t care much about fighting fraud because doing so would risk inconveniencing program beneficiaries (i.e., voters):

[F]or all the incessant promises from policymakers to “eliminate waste, fraud and abuse” in government, the reality is that politicians—and the bureaucrats who administer Uncle Sam’s vast array of programs—are primarily concerned with shoving the money out the door. Indeed, a former Medicare administrator told the Journal, “Unless you change the rules of the game in terms of how Medicare pays, you’ll never fix it, [and Congress is] not going to voluntarily make major changes in a program that is as popular as Medicare.”

As de Rugy notes, the $36 billion in fraud reported by the OMB occurred “before the advent of Obamacare.” She continues: “Imagine what that number may look like in the few years.” [Reason, January 14]

Note that Medicare fraud isn’t counted as part of the Medicare’s overhead, which supporters of government-run health care routinely claim is much lower than the overhead of private health insurers. Of course, Medicare doesn’t even count what the Inspector General spends fighting health care fraud to be part of its overhead. A 2006 study by Merrill Matthews found that a real apples-to-apples comparison shows private health insurance spends only slightly more on overhead than Medicare—partly because it devotes more resource to reviewing claims. [“Medicare’s Hidden Administrative Costs: A Comparison of Medicare and the Private Sector,” by Merrill Matthews, January 10, 2006]

Medicare’s fraud problem shows what’s wrong with the focus on overhead costs: Those costs are not a waste if they prevent fraud and keep overall costs—and thus premiums—low. “Estimates say,” write Merrill and Meredith Matthews, “that claims fraud in private health insurance falls at around 1.5 percent or less.” [See: “The Government’s Health Care Fraud Problem,” by Merrill Matthews and Meredith R. Matthews, The Insider, Summer 2009.]

Posted on 01/15/15 12:46 PM by Alex Adrianson

More Transparency in Ohio

Last month, the Ohio Treasurer put all of the state’s checks online in a searchable database. The site, Ohio’s Online Checkbook, allows anybody to see what the state is spending its money on and who is getting that money.

First, what’s great about the site: It lets you easily drill down to the transaction level and see who is getting what and for what purpose. You can search by receiving entity, agency, and expense type. You can compare expenditures across agencies and across years. You can find out, for example, how much business “the Shelly Company” or “Beaver Excavating Co.” has received from the state in each of the past eight years. Also, every transaction listed comes with contact information for the person or agency in the government who is supposed to know the purpose of the transaction. This kind of information should prove to be very helpful to citizen watchdogs and journalists trying to uncover waste, fraud, and abuse in Ohio state government.

The data is up-to-date through June 30, 2014. Greg Lawson of the Buckeye Institute tells us that the Ohio Treasurer is developing the capability to provide monthly updates as well as include expenditure data for local governments, too. Reporting on local government would be a “big deal,” he says, because they are “legion and expensive” in Ohio.

Now, a few quibbles: The site lets you make charts, but the functionality is limited and glitchy. The data labels were misaligned on one chart we made. You can’t really control the appearance of titles and labels. If you save a chart as an image, you’ll have to add your own labels and titles in a different application. You can export the data when you drill down to the transaction level, but not at the overview level, which would have been handy for making your own charts in Excel.  We tried exporting a list of 876 transactions, but after ten minutes of waiting for the page to load, we gave up.

Also, we noticed the share button doesn’t actually let you share charts you make, but just produces a link with the heading “Ohio’s Online Checkbook.” That doesn’t make for compelling social media content.

The site was obviously designed by accountants. You can filter your search by appropriation line item, program, or fund; but not by city or zip code. You can filter the data by “Expense type,” which is broken down into a hierarchy of category, type, and code. The distinctions between those levels of detail is not intuitively obvious. Say, for example, you want to find grants by the Ohio Arts Council. Is “grant” a category, a type, or a code? Turns out you have to go all the way down to the code level to find the term “grant,” even though grants are the lion’s share of the agency’s expenditures.

Still, making the data available at all is a huge service to Ohio’s taxpayers, and the ease of finding transaction- and vendor-level detail is impressive.

Posted on 01/14/15 06:22 PM by Alex Adrianson

To Do: Get Ready for Advancing Freedom in 2015

Get an inside preview of the key conservative battles of 2015 at the Second annual Heritage Action Conservative Policy Summit. Sens. Ted Cruz (Texas), Mike Lee (Utah), and Rand Paul (Ky.); and Rep. Jim Jordan (Ohio) are among the scheduled speakers. The two-day summit will start at 11 a.m. on January 12 at The Heritage Foundation.

Learn whether President Obama’s executive order on immigration exceeded his constitutional authority. Ross Douthat of the New York Times, William Galston of the Brookings Institution, and Gary Schmitt of the American Enterprise Institute will discuss whether the administration’s claim of prosecutorial discretion is a reasonable interpretation of the president’s constitutional obligations. The talk will begin at noon on January 12 at The American Enterprise Institute.

Get briefed up on the reform landscape in North Carolina. Becki Gray will outline the conservative successes of recent years and how the John Locke Institute plans to defend and expand those victories on taxes, education, energy, regulations, and health care. Gray’s talk will begin at noon on January 12 at the John Locke Foundation in Raleigh.

Examine how lavish public union pension benefits threaten the fiscal condition of states and municipalities. The Mackinac Center will host a talk by the Manhattan Institute’s Daniel DiSalvo on the public unions’ grip on the taxpayers’ wallet.

Celebrate New Year’s again. The Atlas Network will celebrate a new year dedicated to advancing freedom around the globe. The party will kick off at 5:30 p.m. on January 15 at Atlas’s Washington, D.C., headquarters.

Posted on 01/10/15 01:54 AM by Alex Adrianson

Martin Anderson, R.I.P.

Martin Anderson, policy advisor to both President Richard Nixon and President Ronald Reagan, died on Monday. He played a key role, writes John Fund, in steering both Nixon and Reagan to conservative policy ideas:

Teddy White, the author of the Making of the President series, wrote that Anderson became “Reagan’s Seeing Eye Dog … a one-man warehouse of facts … guiding [Reagan] to that growing minority revolting against the dominant liberal ideas that reigned on American campuses.” Many of the academics who served in the Reagan administration were indeed recruited by Anderson.

“Marty was my entry point to both the Nixon and Reagan administrations,” economist Arthur Laffer told me Wednesday. “He knew what good policy was, that it would work if implemented, and he had the courage to push it even when he stepped on the toes of more political advisers.”

Take the military draft. The system by which men were selected for Vietnam service was riddled with unfairness. Many college students and others who had wealth or political pull got exemptions that kept them safely out of uniform. Disrespect for the draft bred contempt for the rule of law, weakened morale in the services, and defied American traditions. In 1968, after he had read Anderson’s memos, Richard Nixon campaigned against the draft, saying it “cannot be squared with our whole concept of liberty, justice, and equality under the law.”

As Reagan geared up to run for president in 1980, Anderson was instrumental in building the intellectual case for Reagan’s proposal to cut marginal tax rates by 30 percent. Anderson correctly predicted that the tax program, combined with restraint in domestic spending and regulatory reform, would lead to expansion that would put Jimmy Carter’s stagnant and inflationary economy (the infamous “stagflation”) in the country’s rear-view mirror. [National Review, January 9]

Posted on 01/10/15 12:32 AM by Alex Adrianson

Liberal Societies Are Not Doing a Very Good Job Defending Their Liberal Values

This week it seems every pundit and commentator devoted at least a little time to weighing in on the deadly terrorist attack against the French satirical magazine Charlie Hebdo. Three attackers yelling “Allahu Akbar” left 12 dead at the magazine’s offices in Paris on Wednesday. Some of the reactions to the attack are worth sharing:

Of course the attacks have something to do with Islam and saying so isn’t racism, writes David Hirsanyi:

The late Christopher Hitchens never actually said “Islamophobic is a word created by fascists, and used by cowards, to manipulate morons,” but he did call it a “stupid neologism” that “aims to promote criticism of Islam to the gallery of special offenses associated with racism.”

Detesting ideas and hating people are not the same thing. Muslims are, and should be, protected equally under the liberal principles everyone else enjoys. Yet, for some reason, when it comes to our discourse, Islam is given a special dispensation from the standards that apply to everyone else who operates under these rules. A criticism of a faith – and the customs and philosophy that go with it – has been transformed into an act of racism.

I’ll never understand why so many on Left feel compelled to provide the most pervasively illiberal ideology on Earth this kind of cover. Nor, for that matter, why so many of my fellow atheists reserve their venom for Christianity (a religion that made secularism possible) while coddling an ideology that would surely destroy it. [The Federalist, January 9]

Enough with the “We are Charlie” business, says Mark Steyn:

And to be honest, it makes me vomit to see people holding these Princess Dianafied candlelit vigils, and using the hashtag #JeSuisCharlie – I am Charlie – and in effect appropriating these guys’ sacrifice for this bogus solidarity. It makes me sick to see all these ‘the pen is mightier than the sword’ cartoons that have appeared in newspapers all over the United States, Canada, Britain, Germany, France, Australia, everywhere, from other cartoonists, again expressing solidarity with these very brave men – but not doing what they did...

These guys are dead because back in 2005, these Danish cartoons were published in an obscure Jutland newspaper, and a bunch of fanatics went bananas and started killing people over them. So a couple of publications on the planet, including mine in Canada, and Charlie Hebdo in Paris, published these cartoons... Le Monde didn’t, and the Times of London didn’t, and the New York Times didn’t, and nobody else did. And as a result, these fellows in Charlie Hebdo became the focus of murderous rage. If we’d all just published them on the front page and said “If you want to kill us, you go to hell, you can’t just kill a couple of obscure Danes, you’re going to have to kill us all”, we wouldn’t have this problem. But because nobody did that, these Parisian guys are dead. They’re dead. [SteynOnline, January 9]

In case you haven’t been keeping score, Western societies have done little to stand up to this kind of intimidation so far, writes Walter Olson:

If you defend freedom of speech today, realize that “blasphemy” is its front line, in Paris and the world.

There is no middle ground, no soft compromise available to keep everyone happy–not after the murders at the satirical newspaper Charlie Hebdo. Either we resolve to defend the liberty of all who write, draw, type, and think–not just even when they deny the truth of a religion or poke fun at it, but especially then–or that liberty will endure only at the sufferance of fanatical Islamists in our midst. And this dark moment for the cause of intellectual freedom will be followed by many more.

Can anyone who has paid attention truly say they were surprised by the Paris attack? The French satirical magazine had long been high on a list of presumed Islamist targets. In 2011—to world outrage that was transient, at best—fanatics firebombed its offices over its printing of cartoons. Nor was that anything new. In 2006, the Danish cartoonists of Jyllands-Posten had to go into hiding for the same category of offense, as had author Salman Rushdie before them.

In a new book entitled The Tyranny of Silence: How One Cartoon Ignited a Global Debate on the Future of Free Speech, journalist Flemming Rose, who was at the center of the Danish cartoon controversy, traces its grim aftermath in the self-silencing of Western opinion. Most of the prestige Western press dodged the running of the cartoons, and beneath the talk of sensitivity was often simple fear. As journalist Josh Barro noted today on Twitter, “Islamists have by and large succeeded in intimidating western media out of publishing images of Muhammad.” [Time, January 7]

There are the times when blasphemy is called for, and this is it, writes Ross Douthat:

[T]he kind of blasphemy that Charlie Hebdo engaged in had deadly consequences, as everyone knew it could … and that kind of blasphemy is precisely the kind that needs to be defended, because it’s the kind that clearly serves a free society’s greater good. If a large enough group of someones is willing to kill you for saying something, then it’s something that almost certainly needs to be said, because otherwise the violent have veto power over liberal civilization, and when that scenario obtains it isn’t really a liberal civilization any more. Again, liberalism doesn’t depend on everyone offending everyone else all the time, and it’s okay to prefer a society where offense for its own sake is limited rather than pervasive. But when offenses are policed by murder, that’s when we need more of them, not less, because the murderers cannot be allowed for a single moment to think that their strategy can succeed. [New York Times, January 7]

The Daily Signal has a sampler of Charlie Hebdo covers with translated captions. Here is one of them:

“If Mohamed came back” depicts an argument: “I am the prophet, you idiot!” “Shut your face, infidel.”


[Daily Signal, January 8]

Posted on 01/09/15 11:31 PM by Alex Adrianson

Harvard Profs Liked Health Care Mandates Before They Realized They Had to Pay for Them

The faculty at Harvard University doesn’t like the new cost-sharing features in the university’s employee health plan, reports Robert Pear. Those features were added because of the Affordable Care Act that many of the Harvard faculty supported (and/or helped design):

In Harvard’s health care enrollment guide for 2015, the university said it “must respond to the national trend of rising health care costs, including some driven by health care reform,” in the form of the Affordable Care Act. The guide said that Harvard faced “added costs” because of provisions in the health care law that extend coverage for children up to age 26, offer free preventive services like mammograms and colonoscopies and, starting in 2018, add a tax on high-cost insurance, known as the Cadillac tax. [New York Times, January 5]

Harvard’s professors, notes Michael Cannon, are just doing what every other American does when it comes to health care: trying to spend more of someone else’s money:

People who pay for their own consumption don’t have the luxury of being able to pretend that tradeoffs don’t exist. Walk into a BMW dealership and announce, “I want a 7-series at Hyundai prices!”, and the dealer will laugh at you. When Medicare enrollees do the same thing – Keep Your Government Hands Off My Medicare! – the people who run Medicare praise and court them.

The seeds of such irrationality can also be seen in the case of Harvard University or any other employer-sponsored health plan, where the federal government imposes stiff tax penalties on anyone who does not (1) surrender $5,000 or $11,000 of their income to their employer and (2) let their employer use that money to select their health plan. Since this goverment policy means that workers don’t control that portion of their compensation, and don’t perceive the direct and negative relationship that employer-provided health insurance has on their wages (partly because they can’t get that money back by declining health benefits), workers end up demanding mutually incompatible things: comprehensive health-insurance coverage that doesn’t cost them anything. If that seems irrational, it is because, as I put it in [a] 2009 blog post, “Socialized Medicine Socializes the Cost of Irrationality, Too.” [Forbes, January 5]

Posted on 01/09/15 10:31 PM by Alex Adrianson

Another Win in the Courts for Economic Liberty

The Institute for Justice has won another victory for economic liberty; this time the victory comes in Texas, where the state had told Isis Brantley she couldn’t teach African hair braiding unless she first spent thousands of hours learning to be a barber and then spent $20,000 installing equipment that barbers, but not hair braiders, might use.

Federal Judge Sam Sparks told Texas it couldn’t do that. As IJ’s Evan Bernick writes, Brantley’s rights were vindicated because Judge Sparks refused to defer to the government’s judgment about whether its regulations served a legitimate government interest:

Judges in rational-basis cases routinely abandon their constitutional duty to seek truth and instead work to rationalize the government’s actions. In seeking to defend the challenged provisions, the government admitted that the provisions “may not be sensible or particularly well crafted” but argued that those who drafted them “could have believed that they furthered legitimate interests in public health and safety,” even if they actually did not. The government invoked Williamson v. Lee Optical (1955), a case in which the Supreme Court upheld a law barring people who were not licensed optometrists or opthalmologists from replacing broken lenses and preventing out-of-state eyeglass retailers from advertising – in the name of public health and safety, of course.

Fortunately for Isis (and unlike the Supreme Court in Lee Optical), Judge Sparks engaged in a genuine search for the truth, focusing on real evidence rather than hypotheticals to justify the government’s actions. Judge Sparks followed the lead of the Fifth Circuit in St. Joseph Abbey v. Castile, another case litigated by IJ. In St. Joseph Abbey, the Fifth Circuit struck down a Louisiana regulatory scheme targeting casket sales, rejecting Louisiana’s “nonsensical explanations” for the scheme after finding them to be factually baseless.

After carefully considering Texas’ hairbraiding scheme, Judge Sparks determined that it did not plausibly further any of the state’s alleged interests. He determined, for instance, that it made no sense for a braiding salon to be forced to install a minimum of five sinks when washing hair is not involved in the braiding process and may not legally be performed by a braider. [Huffington Post, January 9]

Posted on 01/09/15 09:46 PM by Alex Adrianson

Free Money to Attend Community College Means Higher Tuition at Community Colleges

On Thursday, President Obama proposed making two years of community college free for all students maintaining a C average. The cost of the schooling would be paid by federal and state taxpayers. And on Friday, the White House said the plan would cost $60 billion over 10 years.

Plowing that money into community colleges isn’t likely to be a good investment, explains Neal McCluskey:

The federal Digest of Education Statistics reports that a mere 19.5 percent of first-time, full-time community college students complete their programs within 150 percent of the time they are supposed to take. So less than 20 percent finish a two-year degree within three years, or a 10-month certificate program within 15 months. And that rate has been dropping almost every year since the cohort of students that started in 2000, which saw 23.6 percent complete. Moreover, as I itemize in a post at SeeThruEDU.com, even when you add transfers to four-year schools, the numbers don’t improve very much. Meanwhile, interestingly, the for-profit sector that has been so heavily demonized by the administration has an almost 63 percent completion rate at two-year institutions, and that has been rising steadily since the 2000 cohort.

The other huge problem is that the large majority of job categories expected to grow the most in the coming years do not require postsecondary training. Of the 30 occupations that the U.S. Department of Labor projects to see the greatest total growth by 2022, only 10 typically need some sort of postsecondary education, and several of those require less than an associate’s degree. Most of the new jobs will require a high school diploma or less. [Cato Institute, January 9]

Among other problems, the requirement to maintain a C average isn’t going to help achievement in high school, notes Lindsey Burke:

More than one-third of students have to take remedial courses when they enter college, as they leave high school unprepared for university-level work. Free community college would put even less pressure on high schools to produce graduates who are prepared for college-level work, as they could expect the new free community colleges to fill in what the high schools are failing to do. The proposal is more likely to produce a six-year high school system than a two-year gratis workforce preparation experience.

The administration’s proposal is another step toward the White House’s goal of a “cradle-to-career” education system, starting with free preschool and now free community college. And then, even if a student does accrue debt in this new federally funded free-for-all, the administration has capped loan repayments at 10 percent of discretionary income, and any remaining balance is forgiven by the taxpayers after 20 years. And those benefits are even more generous for individuals who work in “public service,” largely defined as government jobs. [Daily Signal, January 9]

Community colleges, writes Scott Shackford, are likely to do what four-year colleges already do: capture the increased financial aid by increasing their costs—and thus their prices—which does nothing to increase access:

One study states from early 2014 states administrative staff led to a 28 percent boom in the higher education workforce, even in the middle of this recession (while faculty salaries remained fairly flat). Community colleges actually lost both part-time and full-time faculty members during the recession, but nevertheless gained an average of three administrative positions per 1,000 students.

[…] It should be obvious now that that calls for “evidence-based institutional reforms” sounds good but is, in actuality, code for “MORE ADMINISTRATORS! WE NEED MORE ADMINISTRATORS DOING STUDIES AND PROVIDING MORE ‘STUDENT SERVICES’ OVER HERE!”

Ultimately what will happen is that the subsidies will be consumed by this bloat and community colleges will not be able to expand to actually accommodate additional students, so we’ll see more students being forced to wait, or tuition costs will quickly rise above the administration’s subsidy (which doesn’t seem to have a cap, but obviously is going to have to or god help us all) in order to get more money to actually pay for the classes the students need. This is exactly what’s happening at four-year colleges already. [Reason, January 9]

For a review of the argument that increases in financial aid for higher education largely get captured by the institutions themselves rather than expanding access, see the work of the scholars at the Center for College Affordability and Productivity, but especially Robert E. Martin and Andrew Gillen’s paper “How College Pricing Undermines Financial Aid,” (March 2011), and Gillen’s paper “Introducing Bennett Hypothesis 2.0,” (February 2012). In that later paper, Gillen explains the key difference between how competition works in higher education and how it works in most other industries:

The key difference between higher education and the bread industry is the nature of competition: In higher education, colleges essentially compete in a zero-sum game for relative standing. Due to the lack of measures of output and outcomes, colleges cannot compete on quality, and instead compete based on reputation/prestige /excellence. Essentially, they use high quality inputs as proxies for quality because there is no way to demonstrate high quality directly. Since high quality inputs are costly, and colleges are playing a zero-sum game of relative position, there is no limit to what college will spend in the pursuit of excellence. Thus, they will spend as much as they can, meaning that revenues drive costs […] .

In contrast, bread producers compete based on value (roughly defined as quality divided by price, both components of which are observable to consumers). Costly improvements to bread making will only be undertaken if they improve quality enough to compensate for the increase in costs (and therefore, in the long run, price).

In short, when someone else pays the bill, the student has no incentive to search for value and universities have little incentive to compete on value. Increasing the level of subsidies can only reinforce what’s wrong with the current system.

Posted on 01/09/15 06:25 PM by Alex Adrianson

The Insider: Can We Save the American Dream?

Think big, like Sen. Mike Lee, we advise conservatives in our Winter 2015 issue:

Conservatives win when they stand for big conservative ideas. President Ronald Reagan’s big idea was that the United States should not merely check Communist influence in the world but actually win the Cold War. Defeat Communism we did: Within a few years of Reagan leaving office, the Berlin Wall had come down and the Supreme Soviet had voted the Soviet Union out of existence.

Prime Minister Margaret Thatcher shared Reagan’s vision of victory and added her own idea of defeating socialism at home. Thatcher stood up to the unions and privatized many of Britain’s state-owned industries, turning them into profitable, competitive ones. Today, not even the Labour party wants to re-nationalize industry.

What else can we learn from conservative successes? In this issue, Lee Edwards and Elizabeth Edwards Spalding identify the lessons of the Cold War, while Nile Gardiner and Stephen Thompson provide us with the top 10 leadership lessons from Margaret Thatcher.

Nicholas Eberstadt, meanwhile, revisits an episode of incomplete conservative success. In 1996, conservatives reformed the welfare system with the big idea that people could be moved from dependency back into work. Those reforms arrested the growth of one welfare program, but welfare dependency has grown nevertheless.

Addressing that backsliding is one item for a new conservative agenda. In our cover story, Utah Sen. Mike Lee identifies another: Getting government to stop using its taxing, spending, and regulating powers to favor some businesses over others. Adopting a zero tolerance policy toward cronyism would not only affirm conservatives’ free market ideals, it would unleash the entrepreneurial creativity needed to get the economy booming again.

Another big idea to pursue, as Jordan Richardson writes, is thinning the thicket of federal laws that make crimes out of ordinary behavior, honest errors, and acts nobody could know are crimes—like packing lobsters in plastic instead of boxes, or mistakenly driving a snowmobile into a federal park during a snowstorm. Overcriminalization, like crony capitalism, turns government into a rigged game. Both need to be stopped if we are to be a republic of laws.

Posted on 01/08/15 06:39 PM by Alex Adrianson

Toolkit: Make the Case for Education Reform: Make It Moral, Fight for People, Do It in Seven Seconds

That’s Arthur Brooks’s advice:

Posted on 01/07/15 12:34 PM by Alex Adrianson

Ohio Protects Its Residents from Accidentally Breaking the Law

Just a few days before Christmas, the state of Ohio made it much less likely that a citizen could end up in jail for unintentionally violating the law. Ohio, like many states, has many laws and regulations that make crimes out of ordinary behavior. And in many cases, a standard of strict liability had been applied. That meant if prosecutors proved that you did what the law forbids, then you were guilty of breaking the law.

Now, thanks to a reform passed by the legislature and signed by the governor, there is a new default standard of criminal culpability. According to that standard, a person must have intended to break the law in order to be found guilty of a violation.

The reform applies this criminal-state-of-mind requirement to all laws for which the legislature did not specify that strict liability applies. Previous, the presumption had been the other way around: Courts had assumed that the legislature intended to apply a strict-liability standard wherever the legislature failed to specify a criminal-state-of-mind standard. The reform also nullifies future acts that create criminal liability without specifying a standard of culpability. [Ohio Senate Bill 361, Engrossed December 17, 2014]

Robert Alt, head of the Buckeye Institute, testified for the law in early December:

The default rule in SB 361 seeks to assure that the traditional requirement of a culpable mind is present in each material element of an offense, except where the General Assembly plainly indicates that it wishes to dispense with the requirement. In so doing, the language reduces the risk that Ohioans who are seeking to follow the rules may nonetheless run afoul of the criminal law without having a guilty mind. [Buckeye Institute, December 2, 2014]

Related:

• Will Ohio’s reform inspire action in other states? The strict-liability standard is prevalent in many states and at the federal level, too. Anne Schieber reports that Michigan legislators are considering creating a default mens rea (criminal-state-of-mind) standard much like Ohio has. Schieber notes some of the ways unsuspecting Michiganders can run afoul of the law:

It is a crime, for example, to transport a Christmas tree without a bill of sale. Since the Christmas-tree law makes no mention of mental culpability, someone could be criminally prosecuted for bringing home a tree without the right paperwork. It is also a crime to purchase a vehicle on a weekend, or to drive a snowmobile that is too loud. Many of the crimes in Michigan’s statute books (48 percent of felonies and 76 percent of misdemeanors) are not part of the penal code and are administrative in nature, meaning they have not been closely scrutinized during the legislative process.

When criminal statues do not contain specific culpability language, prosecutors and judges are left on their own. As Reitz states in his policy brief, “Criminal Minds: Defining Culpability in Michigan Criminal Law,” the result can be “inconsistent interpretation by the courts.” [Michigan Capital Confidential, December 24]

• At the federal level, one potential reform would be to require all bills that create new crimes to be reviewed by the House and Senate Judiciary committees before they can become law. As Alt noted in his testimony, a 2010 Heritage Foundation study found that “the 109th Congress (2005-2006) proposed 446 criminal offenses that did not involve violence, firearms, drugs and drug trafficking, pornography, or immigration violations” of which “57 percent lacked an adequate mens rearequirement.” That study also found that over half of those laws were not sent to the House and Senate Judiciary committees for review. [“Without Intent: How Congress Is Eroding the Criminal Intent Requirement in Federal Law,” by Brian W. Walsh and Tiffany M. Joslyn, The Heritage Foundation, May 5, 2010]

And the Wall Street Journal observes the same problem this week:

The Congressional Research Service (CRS) reports that 403 crimes were added to the federal code between 2008 and 2013, 39 of which weren’t referred to the Judiciary Committee. Two examples that might have benefitted from referral are the crimes for harvesting plants under the Lacey Act (the 110th Congress) and attending animal fighting events (the 113th Congress). [Wall Street Journal, January 2]

As the Journal notes, the House of Representatives is considering a rule change that would require such referrals.

• The new issue of The Insider, just out this week, includes some ideas from visiting Heritage legal fellow Jordan Richardson on how to fix the problem of overcriminalization, including creating a “mistake of law” defense that would “exculpate morally blameless parties for conduct that no reasonable person would have thought was a crime.” [“You Could Break the Law and Not Even Know It: Why Overcriminalization Is Everyone’s Problem and How to Fix It,” The Insider, Winter 2015]

Posted on 01/06/15 05:49 PM by Alex Adrianson

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