Archives: 12/2008

Tis Better to Be Regulated by One Gorilla than by Fifty Monkeys

When Congress lawfully exercises its constitutional powers to regulate a particular aspect of interstate commerce, states cannot also regulate in that area.  This anodyne principle, arising from the Constitution’s Supremacy Clause, is known as preemption.  Today, in its last public action of 2008 and its first 5-4 decision of the term, the Supreme Court violated that principle in a case involving cigarette labeling, Altria v. Good.  The Court erroneously determined that the Federal Cigarette Labeling and Advertising Act does not preempt a suit for fraudulent labeling under state law. 

While the Act expressly covers labeling and advertising “with respect to any relationship between smoking and health,” Justice Stevens’s opinion somehow finds that it does not cover smoking- and health-related suits predicated on the general duty not to deceive.  (The Court was not asked to address, and did not address, the threshold question of whether the Act infringes on the free speech rights of advertisers.) 

As Justice Thomas points out in dissent, the majority has created an unworkable rule that depends on how one frames “the legal duty that is the predicate of the common-law damages action” rather than the text of the federal statute at issue.  Thus, not only will cigarette manufacturers who dutifully comply with federal law now face countless suits under countless state laws, but their fates in those suits will hinge on the creativity of counsel and the gullibility of judges.  And of course, this type of reasoning can easily be extended to circumvent preemption in other regulatory fields, including this term’s eagerly awaited FDA case, Wyeth v. Levine.

Bill of Rights Day

Since today is Bill of Rights Day, it seems like an appropriate time to pause and consider the condition of the safeguards set forth in our fundamental legal charter.

Let’s consider each amendment in turn.

The First Amendment says that Congress “shall make no law … abridging the freedom of speech.” Government officials, however, insist that they can make it a crime to mention the name of a political candidate in an ad in the weeks preceding an election.

The Second Amendment says the people have the right “to keep and bear arms.” Government officials, however, insist that they can make it a crime to keep and bear arms.

The Third Amendment says soldiers may not be quartered in our homes without the consent of the owners. This safeguard is doing so well that we can pause here for a laugh.

The Fourth Amendment says the people have the right to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures. Government officials, however, insist that they can storm into homes in the middle of the night after giving residents a few seconds to answer their “knock” on the door.

The Fifth Amendment says that private property shall not be taken “for a public use without just compensation.” Government officials, however, insist that they can take away our property and give it to others who covet it.

The Sixth Amendment says that in criminal prosecutions, the person accused shall enjoy a speedy trial, a public trial, and an impartial jury trial. Government officials, however, insist that they can punish people who want to have a trial. That is why 95% of the criminal cases never go to trial. The handful of cases that do go to trial are the ones you see on television — Michael Jackson and Scott Peterson, etc.

The Seventh Amendment says that jury trials are guaranteed even in petty civil cases where the controversy exceeds “twenty dollars.” Government officials, however, insist that they can impose draconian fines against people without jury trials. (See “Seventh Amendment Right to Jury Trial in Nonarticle III Proceedings: A Study in Dysfunctional Constitutional Theory,” 4 William and Mary Bill of Rights Journal 407 (1995)).

The Eighth Amendment prohibits cruel and unusual punishments. Government officials, however, insist that jailing people who try in ingest a life-saving drug is not cruel.

The Ninth Amendment says that the enumeration in the Constitution of certain rights should not be construed to deny or disparage others “retained by the people.” Government officials, however, insist that they will decide for themselves what rights, if any, will be retained by the people.

The Tenth Amendment says that the powers not delegated to the federal government are to be reserved to the states, or to the people. Government officials, however, insist that they will decide for themselves what powers are reserved to the states, or to the people.

It’s a depressing snapshot, to be sure, but I submit that the Framers of the Constitution would not have been surprised by the relentless attempts by government to expand its sphere of control.  The Framers themselves would often refer to written constitutions as mere ”parchment barriers” or what we would describe as ”paper tigers.” They nevertheless concluded that putting safeguards down on paper was better than having nothing at all. And lest we forget, that’s what millions of people around the world have — nothing at all

Another important point to remember is that while we ought to be alarmed by the various ways in which the government is attempting to go under, over,  and around our Bill of Rights, the battle will never be ”won.” The price of liberty is eternal vigilance. To remind our fellow citizens of their responsibility in that regard, the Cato Institute has distributed more than three million copies of our “Pocket Constitution.” At this time of year, it’ll make a good stocking stuffer. Each year we send a bunch of complimentary copies to the White House, Congress, and the Supreme Court so you won’t have to.

Finally, to keep perspective, we should also take note of the many positive developments we’ve experienced in America over the years. And for some positive overall trends, go here.

Are We All Keynesians Now?

Reuters reports that Obama may propose as much as $1 trillion (yes, trillion) of new spending, which would be in addition to the huge expansion of government under Bush, is it true (as Richard Nixon once remarked) that “we are all Keynesians now?

Not quite. Here’s a new video that explains why Keynesian “stimulus” proposals are theoretically misguided. The video also provides real-world evidence showing that bigger government does not work.

So if Keynesian spending is theoretically flawed and doesn’t work in the real world, why are politicians on a spending binge? As I state in the conclusion, they love spending other people’s money.

As always, feedback is welcome.

Except for the DNA, He’s Guilty as Hell

Some prosecutors will say or do anything to win a case.  Even if that means convicting an innocent person, letting a rapist off the hook, and smearing an 11-year old girl.  Sometimes these ambitious prosecutors run for higher office and win.  Sometimes they become judges.  In a just world, more of them would repent and then help us to clear landmines.

Taxpayers Picking Up the Tab for a Bigger Bailout Thanks to Republican Lobbyists

The Associated Press reports on the various former Republican politicians who got fat contracts and enriched themselves in exchange for lobbying on behalf of Freddie Mac. Unfortunately for taxpayers, these amoral lobbyists were successful and the government-created entity was able to dig itself even deeper into a hole - which taxpayers are now responsible for filling.

When the Washington Nationals played their first-ever baseball game in the nation’s capital in April 2005, two congressmen who oversaw mortgage giant Freddie Mac had choice seats — courtesy of the very company they were supposed to be keeping an eye on. …The Nationals tickets were bargains for Freddie Mac, part of a well-orchestrated, multimillion-dollar campaign to preserve its largely regulatory-free environment, with particular pressure exerted on Republicans who controlled Congress at the time. Internal Freddie Mac budget records show $11.7 million was paid to 52 outside lobbyists and consultants in 2006. Power brokers such as former House Speaker Newt Gingrich were recruited with six-figure contracts. Freddie Mac paid the following amounts to the firms of former Republican lawmakers or ex-GOP staffers in 2006: Sen. Alfonse D’Amato of New York, at Park Strategies, $240,000. Rep. Vin Weber of Minnesota, at Clark & Weinstock, $360,297. Rep. Susan Molinari of New York, at Washington Group, $300,062. Susan Hirschmann at Williams & Jensen, former chief of staff to House Majority Leader Tom DeLay, R-Texas, $240,790. …The tactics worked — for a time. Freddie Mac was able to operate with a relatively free hand until the housing bubble ultimately burst in 2007.

Interestingly, at least one of these former politicians is contemplating a return to the political arena. He even portrays himself as a friend of the taxpayer. It is unclear, though, how much of a friend he really is considering that the story reveals that, “Freddie Mac enlisted prominent conservatives, including Gingrich…, paying [him] $300,000 in 2006, according to internal records.”

George ‘Herbert Hoover’ Bush

According to Politico.com, Vice President Dick Cheney lobbied Republican senators to support the bailout of auto companies, arguing that it would be “Herbert Hoover time” in the absence of government intervention.

Cheney is right, but for the wrong reasons. To the extent that it is “Herbert Hoover time,” it is because the current administration has repeated many of the mistakes that were made by President Hoover. There was a huge expansion in the burden of government spending under Hoover, up 47 percent in just four years. There’s been an equally huge increase in government spending under Bush. Hoover dramatically increased government intervention with everything from schemes to prop up wages to protectionism. Bush’s intervention takes a different form, with mistakes such as steel tariffs, Sarbanes-Oxley, and bailouts.

Hoover’s legacy is statism. Bush’s legacy is statism. The only unanswered question is whether Obama will be the new Roosevelt — i.e., someone who compounds the damage caused by his predecessor with further expansions in the burden of government.

Does Obama Know Blagojevich?

At the top of the front page of the Washington Post, Eli Saslow’s article is headlined “Obama Worked to Distance Self From Blagojevich Early On.”

The article assures us that they’re very different kinds of Chicago politicians, and they barely know each other. Obamaphile Abner Mikva says, “Obama saw this coming, and he was very cautious about not having dealings with the governor for quite some time.”

But Saslow never mentions a very interesting statement from Obama’s incoming chief of staff, Rep. Rahm Emanuel, that had been reported by ABC, the Wall Street Journal, and other sources in the past few days. Emanuel told The New Yorker earlier this year that six years ago he and Mr. Obama “participated in a small group that met weekly when Rod was running for governor. We basically laid out the general election, Barack and I and these two [other participants].”

Original New Yorker story here. True, one of those other two participants, strategist David Wilhelm, said that Emanuel had overstated Obama’s role. But Rahm Emanuel, a totally connected Chicago pol who is now Obama’s White House chief of staff, says that he and Obama were key strategists for Blagojevich. And that statement had been widely reported. How could Saslow and his editors not mention it?

Sometimes the article’s a bit mysterious. For instance, this paragraph is supposedly about how Obama kept his distance from Blago, but the facts seem to be more about Blago keeping away from Obama:

Long before federal prosecutors charged Blagojevich with bribery this week, Obama had worked to distance himself from his home-state governor. The two men have not talked for more than a year, colleagues said, save for a requisite handshake at a funeral or public event. Blagojevich rarely campaigned for Obama and never stumped with him. The governor arrived late at the Democratic convention and skipped Obama’s victory-night celebration at Chicago’s Grant Park.

And this paragraph? Shouldn’t the phrase “Even though” actually be “Because”?

Even though they often occupied the same political space — two young lawyers in Chicago, two power brokers in Springfield, two ambitious men who coveted the presidency — Obama and Blagojevich never warmed to each other, Illinois politicians said. They sometimes used each other to propel their own careers but privately acted like rivals.