Archives: 05/2008

Reversing the Course of a River

Bruce Schneier is a smart and interesting guy. His sound thinking on computer security has influenced me a great deal, and it extrapolates well into related fields like national security. So I’m always interested to find writings of his with which I disagree. A recent essay in Wired, entitled “Our Data, Ourselves” is one. It calls for “a comprehensive data privacy law.”

This law should protect all information about us, and not be limited merely to financial or health information. It should limit others’ ability to buy and sell our information without our knowledge and consent. It should allow us to see information about us held by others, and correct any inaccuracies we find. It should prevent the government from going after our information without judicial oversight. It should enforce data deletion, and limit data collection, where necessary. And we need more than token penalties for deliberate violations.

If he really believes that these rules should govern the collection and use of data - “all information about us!” - what an administrative nightmare that would be to implement. The benefits of doing so would be quite small in comparison.

Some of these things are agreeable, such as judicial oversight of government data collection (the Fourth Amendment is that law) but even a solid libertarian like myself wouldn’t endorse judicial oversight of government officials looking up information about me on public Web sites, for example.

And should I have a right to review any email in which people discuss this blog post and its author? Incredible.

The flaw in this article (beyond its carelessness) is Bruce’s treatment of these information practices as all-new, and needing an all-new regulatory regime, just because decision-making is now undertaken using “data.”

Whoever controls our data can decide whether we can get a bank loan, on an airplane or into a country. Or what sort of discount we get from a merchant, or even how we’re treated by customer support.

But it’s always been true that decisions like these are made using “data” - perhaps not in digital form, but data/information all the same. When has a decision ever been made not using “data”? We don’t need to throw out old rules about privacy, fairness, and so on just because information is digitized.

Many of Schneier’s premises are correct. The change from analog to digital data systems does cause a lot more tracks to form behind people as they traverse the economy and society. This creates lots of efficiency, convenience, wealth, and problems - threats to privacy, fair treatment, personal security, seclusion, and liberty. Let’s deal with them - each one - on their merits rather than trying to write a single law to overhaul the use of information in society.

Reversing the course of a river would be a tiny problem compared to what Schneier proposes.

The Perverse Incentives of Eminent Domain

Over at the Show-Me Institute’s blog, my former colleague Dave Stokes notices a great example of the kind of damage eminent domain has done to our economy:

Kevin Minden studied a map of the future Mississippi River bridge, looking for clues as to how it might affect his engine rebuilding shop.

One of the connector ramps will run a few blocks from his building, which has him concerned that the bridge might lead to a development boom. Minden fears losing his land to a developer.

“Everything in that area is old,” Minden said. “What are they wanting people to see when they drive across?”

Of course in a rational world, business owners would welcome a development boom because it would mean more business and higher property values. But under the eminent domain laws currently in force in Missouri, re-development is a threat to existing business owners, especially smaller ones, who are likely to be pushed out of the way to make room for new shopping malls, big-box retail stores, and the like. It’s a serious problem. I documented Missouri’s flawed eminent domain laws in a study for the Show-Me Institute last year, but the problem certainly isn’t limited to the Show-Me state. In last year’s eminent domain report card from the Institute for Justice, only five states had done the kind of comprehensive reform necessary to earn an “A” grade, while almost half of states—Missouri included—received a “D” or “F” grade, suggesting that they have done little or nothing to strengthen property rights. Further reforms are needed to ensure that property owners in all 50 states can be secure in the knowledge that they won’t be shoved aside for the benefit of another private party.

Debating Health Care Reform at Colby College

Last month, I debated the direction America should take in reforming its health care sector with Prof. Hugh Waters of Johns Hopkins University’s Bloomberg School of Public Health.  We squared off in front of students and faculty at Colby College in Waterville, Maine, under the auspices of the college’s Goldfarb Center for Public Affairs and Civic Engagement.  Those interested can find more information here or listen to the debate here.

Discussing Taxes & Health Care with the Federalist Society

Earlier this month, I spoke at a Federalist Society event on a panel titled, “Health Care: How Our Tax Laws Affect How Health Care is Paid for and Delivered,” with Bob Helms of the American Enterprise Institute and Prof. Amy Monahan of the University of Missouri-Columbia.  (Mark Pauly of the University of Pennsylvania was scheduled to speak, but had to cancel.)  For the most part, I plugged my Large HSAs proposal.  Those interested can watch or listen to the forum online.

‘The Democrats’ Dangerous Trade Games’

Listening to the Democrats talk about trade on the campaign trail and in Congress, you might conclude that the party is monolithically skeptical about the merits of new trade agreements.

As they campaigned in Ohio and elsewhere, Hillary Clinton and Barack Obama tripped over themselves in competing to see who could denounce NAFTA and other trade initiatives in the harshest terms. Meanwhile, Democratic House Speaker Nancy Pelosi re-wrote established rules on handling proposed trade agreements by shelving the agreement the Bush administration signed with our South American ally Colombia.

In a welcome dissent in this morning’s Wall Street Journal, C. Fred Bergsten, founder and director of the Peterson Institute for International Economics in Washington, sounds a warning against “The Democrats’ Dangerous Trade Games.”

Bergsten has long-standing ties to the Democratic side of the aisle, having served in Jimmy Carter’s administration as assistant secretary for international affairs at the U.S. Treasury during 1977–81.

Bergsten pulls no punches in his op-ed this morning:

[O]ur venerable House of Representatives, in the context of the Colombia agreement, has recklessly changed the rules for congressional action on trade legislation. By rejecting long-settled procedures that prevented congressional sidetracking of trade deals negotiated by presidents, the House has hamstrung U.S. trade policy and created the gravest threat to the global trading system in decades.

By effectively killing “fast track” procedures that guarantee a yes-or-no vote on trade agreements within 90 days, lawmakers in Washington, led by House Speaker Nancy Pelosi, have destroyed the credibility of the U.S. as a reliable negotiating partner.

The op-ed is well worth a read, especially among Democrats who are feeling uneasy about the direction of their party on trade.

A David Brooks Two-fer!

David BrooksCouple of notes on recent David Brooks-related program activities. First, he calls the small-government wing of the conservative movement un-American. No, honestly, he does:

At the end of [1995], when the radical conservatives in the Gingrich Congress shut down the federal government, they learned that the American public was genuinely attached to the modern state. “An anti-government philosophy turned out to be politically unpopular and fundamentally un-American,” Brooks said. “People want something melioristic, they want government to do things.”

Then, in today’s column for the Times, Brooks points out how screwed up the legislative process is, a function of myriad rent-seekers, lobbyists and special interests. His foil? The farm bill:

Interest groups turn every judicial fight into an ideological war. They lobby for more spending on the elderly, even though the country is trillions of dollars short of being able to live up to its promises. They’ve turned environmental concern into subsidies for corn growers and energy concerns into subsidies for oil companies.

The $307 billion farm bill that rolled through Congress is a perfect example of the pattern. Farm net income is up 56 percent over the past two years, yet the farm bill plows subsidies into agribusinesses, thoroughbred breeders and the rest.

The growers of nearly every crop will get more money. Farmers in the top 1 percent of earners qualify for federal payments. Under the legislation, the government will buy sugar for roughly twice the world price and then resell it at an 80 percent loss. Parts of the bill that would have protected wetlands and wildlife habitat were deleted or shrunk.

My colleagues on The Times’s editorial page called the bill “disgraceful.” My former colleagues at The Wall Street Journal’s editorial page ripped it as a “scam.” Yet such is the logic of collective action; the bill is certain to become law. It passed with 81 votes in the Senate and 318 in the House — enough to override President Bush’s coming veto. Nearly everyone in Congress got something.

Funny thing, though: I bet I can think of a much, much better example of what Brooks is driving at here. After all, at least there was broad elite consensus that the farm bill was depraved. But where could we find an example of a legislative product where literally all interests are tied up in rent-seeking and resource extraction? Ah, right:

In current national security politics, there is debate, but all the interests are on one side. Both parties see political reward in preaching danger. The massive U.S. national security establishment relies on a sense of threat to stay in business. On the other side, as former defense secretary Les Aspin once wrote, there is no other side. No one alarms us about alarmism. Hitler and Stalin destroyed America’s isolationist tradition. Everyone likes lower taxes, but not enough to organize interest groups against defense spending. A scattering of libertarians and anti-war liberals confronts a bipartisan juggernaut. The information about national security threats comes to Americans principally from people driven by organizational or electoral incentives toward threat inflation.

Physician, heal thyself. Yet more evidence the that contemporary Right offers nothing of value to libertarians.