Archives: 12/2008

Meat Means Research!

Matthew Yglesias is less than impressed by the scientific rigor of my last post, pointing out that “if I wanted to be taken seriously as a researcher, I wouldn’t pretend to believe that the BLS-defined ‘Education and Health Services supersector’ of the labor market was identical to unionized primary and secondary school teachers.”

Ouch!

You know, come to think of it, if I’d wanted that post to be a major contribution to humanity’s understanding of American education, I probably shouldn’t have put a big picture of Meat Loaf on it, either! Heck, I probably shouldn’t have done it as a tiny blog post at all! What an idiot I am!

Fortunately, you’ll find a longer, more thoughtful explanation of the point I was oh-so-embarassingly trying to make here (though it, too, is on a blog), and then you can just take my little contribution for what it is: a quick bit of info suggesting that there could be some economic upside to being a public-school teacher.

Belarus Joins the Flat Tax Club

It seemed like 2008 was going to be a bad year for tax reform. After a flurry of activity in 2006 and 2007, which resulted in 10 new countries adopting simple and fair flat taxes, the global shift to better policy ground to a halt.

Fortunately, Belarus has picked up the baton of tax reform, replacing a so-called progressive system with a top rate of 35 percent with a 12 percent flat tax. So after a period of inactivity, it’s time to once again cue up the theme song of the flat tax revolution.

The Financial Times has more details on fiscal liberalization in Belarus: 

Life is improving for private business in Belarus, albeit from a position in which arbitrary action was the hallmark of economic policy. … Taxation remains high by regional standards, with general government revenue at over 45 per cent of GDP, compared with 30.5 per cent for Ukraine and 20 per cent for Russia. … Overall, says the deputy finance minister, Vladimir Amarin, next year’s budget will reduce the tax burden by 1.3 per cent of gross domestic product, and future budgets will shave a further 2.4 per cent of GDP off it. The nationwide turnover tax, which last year was 3.4 per cent, will be phased out entirely by 2010, while local sales taxes are, from 2009, to be levied at a flat 5 per cent rate from a 5-15 per cent scale. Personal income tax, hitherto levied according to a progressive scale of 9-35 per cent, will be a flat 12 per cent. … “The tax burden is now lighter and the system is simpler” says Dmitry Duchitsky, chief executive of lingerie maker Milavitsa, a major beneficiary of the planned reforms.

Supreme Court to Decide al-Marri Case

Today, the Supreme Court announced that it will hear an appeal in the case of Ali al-Marri, a Qatar citizen who, while a student at Bradley University in December 2001, was arrested under terrorism suspicions. He was initially charged with making false statements to the FBI and to financial institutions, but those charges were dropped in 2003 when President Bush designated him an unlawful combatant. Despite the lack of charges, Marri is being held indefinitely at the Naval Consolidated Brig in Charleston, S.C. He is the only person designated an enemy combatant who is known to be held in the continental United States.

This is another very important case that will consider the scope of executive power.

For previous coverage and background, go here and here.

Happy Repeal Day!

Today is a great day in American history. Exactly 75 years ago, the 21st Amendment was ratified, thus repealing Prohibition. But Prohibition isn’t a subject that should be studied by historians alone, as this failed experiment continues to have a significant impact on our nation. 

Groups like the Women’s Christian Temperance Union, a key force in the passage of Prohibition, survive to this day and continue to insist that Prohibition was a success and advocate for dry laws

Prohibition-era state laws, many of which are still on the books today, created government-protected monopolies for alcohol distributors. These laws have survived for three-quarters of a century because of powerful, rent-seeking interest groups, despite the fact that they significantly raise costs and limit consumer options. And because of these distribution laws, it is illegal for millions of Americans to have wine shipped directly to their door.

To learn more about the history and legacy of Prohibition, check out my podcast and watch the live webcast of Cato’s policy forum, “Free to Booze: the 75th Anniversary of the Repeal of Prohibition,” starting at 3:30 today.

Happy Repeal Day

Today is the 75th anniversary of the repeal of alcohol prohibition. We are, alas, living in a time when way too many people think that the way to solve problems and improve the human condition is to enact more laws. Let’s remember that repealing certain laws can actually help to create a more free and prosperous society! 

Cato is celebrating today’s anniversary with an event this afternoon entitled “Free to Booze.” 

More thoughts on Repeal Day from Radley Balko and our friends at MPP. For Cato scholarship, go here, here, and here.

Encore for the NEA!

Just like last month, while all other sectors of the economy were watching jobs disappear, health care, education, and government added positions:

The only sectors where jobs were created last month were in education and health services, which created 52,000 jobs last month, and in government, where 7,000 jobs were created last month as well. Education, health and government are considered recession-resistant professions and do not tend to shed jobs in times of economic slowdowns.

I read a lot of articles these days trying to scare people half to death about potential draconian cuts to government schooling, but at the very least it doesn’t seem any of our educators should have trouble finding jobs. I mean, you’d think that maybe a few jobs would be cut, not thousands added!

With that in mind, its time for another Meat Loaf power ballad! Our politicians will do anything for taxpayers but cross the NEA. No, they won’t do that!

Originalism vs. Class Action Reform

David Boaz once suggested that the Class Action Fairness Act—an important statute that federalizes lots of abusive lawsuits traditionally confined to states—gives federal courts power they shouldn’t have.  In this article, I marshal new evidence of the Constitution’s original meaning that supports David.

In a nutshell:  the evidence confirms an interpretation of the Constitution’s text advanced by (gasp!) Public Citizen’s litigation director Brian Wolfman.  CAFA pins federal jurisdiction over state-filed class actions on the fact that many classes include members who are citizens of different states than the defendant.  Congress, in turn, assumed these suits fall within federal courts’ jurisdiction over “controversies between citizens of different states.” 

However, in congressional testimony on CAFA, Wolfman argued that proposed members of a class are not parties to a constitutional “controversy.”   For reasons too technical to go into here, if Wolfman’s right that would punch a big gaping hole in CAFA, allowing plaintiffs’ lawyers to easily evade federal jurisdiction in lots of cases. 

My evidence suggests Wolfman is correct—although Congress has the power to rewrite CAFA in a way that would make it constitutional.  Unfortunately, as the article explains, a “fix” for CAFA is probably not politically feasible, at least in the forseeable future.

For more on the argument, which involves some pretty technical points of federal jurisdiction and class action law, see the abstract, posted here, and a longer excerpt from the article posted by Professor Larry Solum on his Legal Theory Blog here.

The bottom line:  Tort reformers who are faithful to the original meaning of the Constitution must confront the uncomfortable fact that the Constitution takes key provisions of CAFA, the tort reform movement’s greatest legislative achievement, off the table.