Sen. Mike Lee on Executive Power & Conscientious Electors

This weekend, I sat down with Senator Mike Lee (R-UT) for the Cato Daily Podcast. We discussed executive power, criminal justice reform, the Electoral College and this strange, disappointing election year. Here’s a portion of our discussion:

Caleb Brown: President Obama has said he’s concerned, and I have a bit of a hard time taking some of what he says seriously, he’s concerned about leaving a loaded gun around in the White House for the next President, which is, it’s almost comical.

Senator Mike Lee: That’s wonderful. If that is a deathbed repentance, it’s better than no repentance at all. I would like to see what he means by that. I hope he means the same thing that you or I would mean if we made that kind of a statement, which people like you and I do, say things like that all the time. Look, this President has, in fact, taken a lot of steps in the direction of consolidating power in the Executive Branch. And this has been one of the consistent refrains that you’ve heard from some members of Congress. One of the consistent themes that I’ve tried to follow, is pointing out to Republicans and Democrats alike, in both Houses of Congress, look, regardless of how you feel about this President’s policy, regardless of how you feel about this President’s political orientation, this is a bad practice. This is something that ought to scare the daylights out of any Republican or any Democrat or Libertarian or person of any other political stripe, because this is not American. This is not how we do things.

We don’t live in a kind of government where Presidents can appropriately say if Congress won’t act, I will. That’s kind of scary. Scary because of what it says about the consolidation of power in the minds of the chief executive, in the minds of the American public as far as they regard the executive, it’s also scary for the simple reason that in many respects the law allows them to do precisely that. Because we’ve got so much buildup from so many decades of broad, amorphous, quasi lawmaking, where we basically say we shall have good law in area X, and we hereby delegate to department or agency Y the power to make good law in area X. Well guess who controls department Y? The President, and those he chooses, who normally serve at the pleasure of the President. So, in many respects, Congress has enabled this. Congress has created this monster. And it’s time for Congress to tame the monster once again.

Brown: Is there any appetite to do that this year?

Lee: There is a strong appetite on the part of some members of Congress to do that. I don’t, frankly, sense a lot of appetite from the White House. In fact, aside from this statement which was made very recently and has yet to be followed up by anything substantive that I’m aware of, you don’t ever hear that from the White House. And shockingly, you don’t hear it very much from very many members of Congress. That is starting to change, and I’m going my best to change that, but most members of Congress have become strangely, bizarrely content with allowing for this delegated lawmaking trend to continue. And in fact I wrote a book called Our Lost Constitution, it just came out in paperback, and in Our Lost Constitution I explain that even though our Founding Fathers thought that each branch of government would have a strong, compelling interest to guard jealously its own power, what we see is that in the last few decades the opposite has been true for Congress. Congress has been eager to delegate more and more.

Land Use and Economic Mobility: You Could Have Read It Here First

Wednesday’s Wall Street Journal contains a great page 3 article on how stricter land use regulations are slowing the growth of housing in areas that need it most. Laura Kusisto reports on a developer’s fight to build middle-class housing in downtown San Francisco, but she notes that similar problems can be seen in wealthy communities from New York and Connecticut to San Diego and Portland, Ore. She also cites academic research on the topic:

According to research by Daniel Shoag, an associate professor of public policy at Harvard University, and Peter Ganong, a postdoctoral fellow at the National Bureau of Economic Research, a decadeslong trend in which the income gap between the poorest and richest states steadily closed has been upended by growth in land-use regulations.

Moving to a wealthier area in search of job opportunities has historically been a way to promote economic equality, allowing workers to pursue higher-paying jobs elsewhere. But those wage gains lose their appeal if they are eaten up by higher housing costs. The result: More people stay put and lose out on potential higher incomes.

For on-the-ground reporting, you need newspapers. But you could have read about that paper twice in Cato Institute publications. Regulation magazine editor Peter Van Doren wrote about it in Winter 2013-2014 in his “Working Papers” column on new research (page 78). 

And just two months ago a summary version of the paper appeared in the Research Briefs in Economic Policy series edited by Jeff Miron, director of economic studies. 

I hope state and local policymakers will take note of the findings in this paper.

Stay tuned to the Cato Institute for more ahead-of-the-curve ideas.

GOP Senate Candidates in Tight Races Reject Trump’s Anti-Immigrant Message

As Donald Trump doubled down on his anti-immigration message in last night’s debate, Republican candidates for Senate across the country are not adopting his lines. In fact, they are overwhelmingly going the other way, rejecting mass deportation and endorsing legal immigration and various forms of legalization for those immigrants illegally in the United States. Here are what the candidates in the tightest races are saying:

1. Arizona – John McCain

It comes as little surprise that Sen. McCain, a longtime proponent of immigration reform and coauthor of the Senate 2013 reform bill, should be running on an openly pro-immigrant platform. He touted his accomplishment at his Senate debate last week. “I was able to get immigration reform through the United States Senate,” he said. “That is the very big difference between having working groups and talking about it and legislative accomplishment, and I promise you that the Dreamers were part of immigration reform.”

2. Florida – Marco Rubio

Sen. Rubio also coauthored the 2013 reform bill that passed the Senate. Although he has backed away from that approach, he continued to take a pro-immigration position at his debate. “I personally know people, children included, who are in this country out of status, illegally brought here at a very young age, and I see the sadness that they’re going through. I want to fix the problem,” he said. “The second step would be to modernize our legal immigration system so that it’s not as bureaucratic, and it works better. … Republicans would support doing something very reasonable with people that are not criminals, that have been here a long time.”

3. Illinois – Mark Kirk

Sen. Kirk who voted for the 2013 reform bill defended his pro-immigrant position during his campaign. In a campaign ad in Spanish, he said, “When Donald Trump says bad things about immigrants, I have spoken out against him. I don’t support Trump. I’ve worked with Republicans and Democrats to reduce gang violence in Chicago. And I support immigration reform so families can stay together.”

4. Indiana – Todd Young

Rep. Young has previously endorsed a form of legal status for the unauthorized immigrants in the country. In his race, he appears to have backed off this position a bit, while still taking a much more pro-immigrant position than Trump. “Immigration should be attractive to Americans so long as immigrants come to our country to contribute to our economy and society. I strongly support legal immigration,” he said in response to questions from a local news outlet. “I would consider proposals which require those who have entered the U.S. illegally to apply for their visas from their home countries and not from within the US…. Congress should work to find a rational middle ground between granting an automatic path to citizenship for every illegal immigrant and a program of mass deportation.”

Turkey Attacks Anti-ISIS Forces in Syria

Obama administration officials were outraged when Russian and Syrian government planes recently attacked rebel positions in and near the city of Aleppo.  Such raids were a humanitarian atrocity, President Obama charged, when they struck civilian targets.  But Washington had little patience even for assaults directed against military targets.  Those attacks, U.S. officials contended, played into the hands of ISIS by damaging insurgent elements opposed to that extremist group and even creating incentives for moderates to make common cause with ISIS.  The regime of Bashar al-Assad and its Russian allies responded with the assertion that they were not targeting moderates, but were in fact attacking either ISIS units or other “terrorists.

Whatever the merit of Washington’s criticism in that case, it has been severely undermined by the latest action of America’s “loose-cannon” NATO ally, Turkey.  The Turkish military just launched attacks against forces of the YPG, the Kurdish People’s Protection Units, in positions north of Aleppo.  According to Turkish authorities, the raids killed some 200 Kurdish fighters.  Ankara insists that the YPG is affiliated with the outlawed Kurdistan Workers Party (PKK), a violent separatist movement in Turkey itself.  YPG leaders deny such a connection, and Washington continues to regard Kurdish forces as a crucial component of the anti-ISIS coalition.

This latest incident underscores three points.  First, Turkey is an increasingly unreliable ally that pursues its own narrow agenda regardless of Washington’s wishes.  Second, regardless of Ankara’s probable motive, which apparently was to stem growing Kurdish power in both Syria and Turkey, the attack objectively strengthened ISIS by damaging one of its most effective military adversaries.  Third, the Syrian civil war is incredibly complex.  It is not a simple melodrama featuring the evil Assad regime versus noble, freedom-seeking rebels.  The insurgents themselves are extensively fragmented, with agendas ranging from genuine Western-style democracy to Saudi-style Islamic fundamentalism.  Outside parties, especially Russia, Turkey, Iraqi Kurdistan, Iran, and Saudi Arabia, all back certain Syrian factions to advance their own geopolitical objectives. 

To its credit, the Obama administration has refrained from full-scale involvement—a “big footprint” military intervention–in Syria’s civil war.  But U.S. efforts to encourage Assad’s ouster helped create the ongoing tragedy, and even Obama’s “light footprint” strategy has entangled the United States far too deeply in a murky and ultimately unwinnable struggle.   One hopes that the next president will have the wisdom to extricate the United States from this beckoning quagmire and let the Turks, Russians, Saudis, and others deal with the headache of the Syrian civil war.  

On the Poverty of Constitutional Debate

In last night’s third and final presidential debate we were treated, finally, to a brief discussion of what should have been a central issue in these debates—the meaning of the Constitution and the role of the Supreme Court under it. Unfortunately, the discussion got off on the wrong foot right from the start when moderator Chris Wallace asked Secretary Clinton, “Where do you want to see the Court take the country?”

It’s not the role of the Court, of course, to take the country anywhere. Its role, rather, is to correctly read the law—constitutional, statutory, or regulatory—and apply it to the cases that come before it, period. Wallace quickly recovered, however, by asking how the Constitution should be interpreted—by reading the Founders words for what they say, or by reading it as a living document to be applied flexibly according to changing circumstances? That’s been the great jurisprudential question since Progressives prevailed on the New Deal Court to follow the second course, resulting in the Leviathan that surrounds us today.

Ever the Progressive, Clinton answered that “the Supreme Court needs to stand on the side of the American people, not on the side of the powerful corporations and the wealthy.” Read our basic legal document as carefully as you wish, you will find no such opposition between the people and the powerful. Clinton’s populist appeal was a prelude, of course, to her attack on the Court’s 2010 Citizens United decision, which upheld the First Amendment right of corporations and labor unions to make independent political expenditures—in that case, let’s remember, the right of a nonprofit corporation to advertise “Hillary: The Movie” in broadcasts within 30 days of the 2008 Democratic primaries. It’s personal.

For his part, Trump rambled, as usual, but when he finally got to the point, he at least called it correctly, promising that the judges he would “appoint” (the president nominates, not appoints; and Trump can hardly promise for others) “will interpret the Constitution the way the Founders wanted it interpreted.” Unfortunately, the discussion that followed—warring arguments over guns and abortion—was more politics than law, as doubtless is to be expected at this point in our constitutional history, when even extended judicial confirmation hearings reflect politics more than law, to say nothing of the Court’s Obamacare opinions, among others. We’re far removed from the Federalist Papers.

Courts Should Stop Approving Unfair Class Action Settlements

Class actions play a vital role in our legal system. These lawsuits are often the only vehicle for injured plaintiffs to receive compensation when a defendant’s wrongs are widely disbursed and it would be impractical for a single individual to sue.

Yet the process of settling these suits is subject to perverse incentives on the part of the lawyers representing the injured parties. Class counsel often will seek the largest portion of the settlement award for themselves—structuring the settlement to maximize attorney fees—at the expense of class members.

Sadly, this sort self-dealing on the part of class counsel is exactly what happened in Blackman v. Gascho. The case centers on a consumer class action filed against Global Fitness Holdings LLC, alleging that the between 2006 and 2012, the company sold gym memberships and incorrectly charged fees pertaining to cancellation, facility maintenance, and personal-training contracts. A group of plaintiffs sued Global Fitness over the fees, and the parties entered into a “claims-made” settlement.

This type of settlement allows the defendant to make a large amount of money “available” to class members, but in order for the members to collect, they must jump through the hoops of correctly filing claims. Because of the low response rate in such settlements, the defendants will end up paying much less than the funds made available. Indeed, of the $8.5 million made available to the class members, Global Fitness only paid $1.6 million—a payout of approximately 10 percent of the settlement funds. Despite this low payout to plaintiffs, class counsel are still paid a certain rate based on the funds that were made available—not the funds that were actually paid out—in some instances giving them attorney fees larger than the class members’ damages award!

The class counsel here were paid $2.4 million, nearly $1 million more than the class members collected. Josh Blackman, also a Cato adjunct scholar, just happened to be one of the class members. He challenged the settlement, arguing that the agreement was giving the class attorneys preferential treatment over the class members who did not collect. The district court approved the settlement, however, and the U.S. Court of Appeals for the Sixth Circuit agreed with the district court by a 2-1 vote.

Cato has now filed an amicus brief urging the Supreme Court to review the case. Federal Rule of Civil Procedure 23(e)(2)—and fundamental tenets of due process—require that a settlement that binds class members be “fair, reasonable, and adequate.” In this case, the Sixth Circuit upheld approval of a settlement that provided zero compensation for over 90 percent of class members, and in the process broke with the Third, Seventh, and Ninth Circuits. 

The Supreme Court will likely decide by the end of the year whether to take up Blackman v. Gascho.

What They Didn’t Tell You on the Saudi Road Show

The Saudis have just completed peddling their new $15bn bond issue (with more to come). One thing that’s been swept under the rug is a smoking gun. A smoking gun because it’s an indication of just how much trouble the Kingdom is in.

The most telling sign of the depth of the Saudi welfare state’s troubles is the fact that they switched from the lunar-based, religious Hijri calendar to the western Gregorian calendar on October 1, 2016. The reason for this radical change is simple economics.

The Gregorian calendar has 10.9 more days than the Hijri calendar, meaning that the public sector can cut costs through the dilution of wages—same pay spread over more working days. In another move that touches on sensitive religious matters, the Kingdom has announced that it will increase visa charges for people completing their religious pilgrimage, the Hajj. Even in the Kingdom of Saudi Arabia, economics has trumped religion.