Archives: 12/2008

Race-Based Government in Paradise?

The current Supreme Court term is a bit of a letdown for those of us who track and comment on the machinations of One First Street; a steady diet of technical statutory interpretation questions without many “meaty” constitutional issues. Well, yesterday Cato filed its first amicus brief of the term in a case that itself is fairly sui generis — the issue is whether Hawaii can sell certain state lands without getting approval from a weird racialist commission called the Office of Hawaiian Affairs (OHA). But the case has broader ramifications for the Court’s equal protection jurisprudence. Moreover, as Cato’s resident Hawaii expert (we have a low bar here for that niche), I can say that the case threatens to set a terrible precedent for a state that has otherwise been a model of racial harmony.

In the 2000 case of Rice v. Cayetano, the Supreme Court held that a race-based scheme allowing only statutorily defined “Hawaiians” to vote for the OHA’s trustees was unconstitutional. Despite Rice, and despite Justice John Marshall Harlan’s dissenting statement in Plessy v. Ferguson 112 years ago that “[o]ur Constitution is color-blind, and neither knows nor tolerates classes among citizens,” the OHA continues to view Hawaiian citizens through racial lenses. This practice has spawned numerous lawsuits, including the present legal crisis in which the state’s sovereign authority to manage its land for the good of all of its citizens has been replaced with a court-imposed duty to hold the land for the benefit of one racial class.

Specifically, the Hawaii Supreme Court blocked the sale of certain state lands based on a mistaken (and race-based) interpretation of a joint resolution that Congress passed in 1993 to apologize to Hawaiian people for the overthrow of the Kingdom of Hawaii — which was itself based on a slanted view of history. Cato’s brief, joining with the Pacific Legal Foundation and the Center for Equal Opportunity, argues that race-based government is impermissible under the Fourteenth Amendment’s Equal Protection Clause, that the Constitution’s Indian Commerce Clause does not provide a basis for laws that grant preferences to “Native Hawaiians,” and that the Apology Resolution neither amended nor rescinded the federal laws that gave the State of Hawaii full control over the disputed land.

For other filings in the case, see here. Argument is scheduled for February 25.

Sen. Coburn Releases ‘Worst Waste of the Year’ Report

This morning, Sen. Tom Coburn (R-Okla.) issued a report detailing some of the more wasteful uses of taxpayer money by the federal government in 2008. (Read the report here.) By the time I was done reading, I felt physically nauseated. Any taxpayer with the slightest bit of concern as to how Washington blows money will likely feel the same. I won’t go through the numerous examples in the report, but I do have to admit that the $15,000 in HUD Community Development Block Grants for a voice mail service for the homeless left this already cynical budget observer dumbfounded.

I was pleased to see that the report does an ample job of tying in the obvious examples of waste with the big-picture spending problem in Washington. It notes that outrageous spending is occurring “despite the fact that by the end of the fiscal year the federal government spent nearly $3 trillion, but racked up a $455 billion budget deficit — the largest in the nation’s history. If the surpluses from Social Security and Medicare are not included, the true federal deficit was $639 billion. The current national debt stands at more than $10.6 trillion, which must be repaid with interest.”

More ominously:

Driving a substantial portion of the federal budget each year is the government’s social insurance programs: Medicare, Medicaid and Social Security. Estimates prepared by the Government Accountability Office (GAO) — the investigative arm of Congress — show that the projected cost to the government of paying for these programs in the future will be at least $52.7 trillion. More simply, every American currently owes at least $410,000 to pay for the commitments made by the government in these areas, though that figure is on the rise.

Frighteningly, the responsibility for heading off this looming fiscal disaster is in the hands of people who tossed $100,000 of taxpayer dollars at a study of American and Chinese video game habits.

The report’s cover has a picture of Santa Claus with dollars in his hand. It immediately reminded me of one of Chris Edwards’ favorite books: Congress as Santa Claus, which was written by constitutional scholar Charles Warren in 1932. Toward the end, Warren cites a paragraph from a book comparing ancient Rome with the U.S. that’s worth reflecting upon:

Little by little, the State let itself be persuaded to do for each of its cities what it had done for Rome…. With a view to easing the misery of the urban proletariat, it took public works in hand in every direction, regardless of their utility. It distributed victuals free or at half price…. But all these schemes cost money…. The intensification of the evil was met by an increase in the dose of the very remedy which aggravated it — useless expenditure in the cities, ruinous taxes on agriculture. Matters went from worse to worse, until the system reached the limit of its elasticity, and the whole social fabric collapsed in a colossal catastrophe.  This is precisely the mistake which modern civilization must learn to avoid.

Bye Bye, Budget Witch!

Thanks to all the bailouts and stimuli, higher ed folks are singing “Hail, hail, the witch is dead! Which old witch? The Budget Witch!”

Yesterday, a whole slew of ivory-tower advocacy groups called on Congress to furnish big increases in Pell Grants and work-study as part of any upcoming stimulus package. And that’s probably just the beginning of the rampant Treasury-looting (or is it looting future generations?) in which they intend to partake. 

Explained Barmak Nassirian, associate executive director of the American Association of Collegiate Registrars and Admissions Officers:

“I think everybody is going to fight for their fair share,” Nassirian says of the current budget climate.

As a result, long-time concerns about deficit spending and limited resources have all but vanished. “The budget always has checkmated many policy ideas we presented in the past,” Nassirian says. Of the abrupt shift in tone in Washington, he says, “It’s extraordinary.”

We’re not in Kansas anymore, Toto.

Predicting Alarmism

Here’s the punchline from the report released last week by the Commission on the Prevention of WMD Proliferation and Terrorism: “It is more likely than not that a weapon of mass destruction will be used in a terrorist attack somewhere in the world by the end of 2013.”* That prediction was the lead in hundreds of news reports that the report generated last week.

The trouble is, in over 100 pages, the report’s authors never justify their alarming claim. It’s not that they do a poor job explaining how they arrived at the “more likely than not” in five years figure. They simply make no attempt to explain how they got there, other than to say that they talked to lots of experts.

They missed some. For a sober assessment of terrorists’ utterly failed efforts to develop biological weapons, see Milton Leitenberg. On nuclear terrorism, see John Mueller or Michael Levi. Note that even Mueller’s critics tend to agree that the odds of nuclear terrorism are generally overstated. See also Brian Jenkins and Michael Krepon.

Readers of the report should know that Commissioner Graham Allison has been making these sorts of predictions for some time, as John Mueller has noted:

[Allison] proclaims his “considered judgment” in his book: “on the current path, a nuclear terrorist attack on America in the decade ahead is more likely than not” (2004, 15). He repeats that judgment in an article published two years later without reducing the terminal interval to compensate — apparently the end date is an ever-receding target (2006, 39). Actually, he had been in the prediction business on this issue at least as early as 1995 when his imagination induced him boldly to pronounce, “In the absence of a determined program of action, we have every reason to anticipate acts of nuclear terrorism against American targets before this decade is out.”

It would have been helpful if the authors offered some analysis of why past dire predictions have not come true before issuing new ones.

For more on this issue, come to Cato’s upcoming counterterrorism conference. On January 12 and 13, a variety of experts will be here discussing the danger of terrorism and the danger of overreacting to it. I’m running a panel on terrorists’ ability to use nuclear and biological weapons with Mueller, Leitenberg, Randy Larsen and a soon-to-be-named fourth expert.

*As I have written before, we should abolish the term, “weapons of mass destruction.” It confuses the lethality of the weapons it subsumes and policy discussion. On the silliness of the phrase, read Owen Cote.

Doherty Book Review

There’s a review of Brian Doherty’s new book, Gun Control on Trial: Inside the Supreme Court Battle over the Second Amendment, over at McClatchy’s Washington Bureau.  “[T]he book is a brisk read, and it has the kind of direct observation and insider detail that can help bring even a well-plumbed case back to life.” 

Heller continues to spur controversy in the legal community.  Judge Harvie Wilkinson III of the Court of Appeals for the Fourth Circuit compared it to Roe v. Wade as judicial intervention in an issue that should have been resolved by the political branches.   Cato Associate Policy Analyst David Kopel responded on the legal blog The Volokh Conspiracy, making the point that, unlike abortion, the right to keep and bear arms is express in the Bill of Rights. The full paper, co-authored with Professor Nelson Lund of George Mason University School of Law, is available here.

When Are “Poor Choices” a Good Thing?

When they are the educational choices made by the world’s poorest people.

By now, most people working in international development and education have heard that some of poorest people on the planet have given up on their failed government schools and started paying for ultra-low-cost private schooling out of their own nearly-empty pockets. But the experts have usually ignored the phenomenon, or deprecated these private schools and the parents choosing them. In the past few years, however, researchers like James Tooley have blow this story wide open, revealing that fee-charging private schools are enrolling the majority of students in many Third World slums and villages, and that they are significantly outperforming the much higher-spending “free” government schools.

In a new Forbes commentary, former U.S. assisitant secretary of education Chester Finn tells how he went from skeptic to convert by seeing these schools for himself in the impoverished Old City of Hyderabad.

Want to visit these schools, too, but are a little apprehensive about the air fare? Just stay tuned until next April when Cato publishes The Beautiful Tree, James Tooley’s first-person narrative account of his research, adventures, and discoveries from the shanty towns of Africa to the remote mountain villages of Gansu, China.

If the free education marketplace can more effectively serve families in some of the most disadvantaged corners of the globe, imagine what it could do in far wealthier nations such as our own.

Investment: Government and Private

There is much excitement about a federal “stimulus” plan focusing on state and local infrastructure spending. At first blush, it seems like a pro-growth idea to get unemployed construction workers off the couch and onto the job site building new government highways, bridges, and the like.

However, national income data from the Bureau of Economic Analysis puts some perspective on such government investment ideas. (See Tables 1.1.5 and 3.17)

The government isn’t the only entity that builds “infrastructure.” New semiconductor plants, refineries, and electricity transmission wires are private infrastructure, which is every bit as important to economic growth as government highways. Indeed, U.S. private infrastructure investment is 4.6 times larger than all federal, state, and local investment combined.

The figure shows that gross private domestic investment was $2.1 trillion in 2007. That compared to $340 billion of gross investment for state and local governments and just $123 billion for the federal government. And note that most ($82 billion) of the federal investment was for military hardware, and thus did nothing for our standard of living in the sense of creating consumable products.

What is the policy upshot? It is far more important for the government to create an environment where private investment can thrive than it is for the government to invest itself. 

The private sector puts new factories and equipment in place when it can earn at least a normal return on the income generated over future years. The government skims off roughly a third of the return in income taxes (and most of that money dissappears down the economic black hole of transfer spending). A reduction in that skim would cause relatively little government revenue loss compared to the huge leverage effect it would have over the gigantic private sector investment budget.

So, let’s cut the corporate income tax, and while we’re at it, privatize as much state and local infrastructure spending as we can.