Archives: 04/2009

U.S. Chamber on Electronic Employment Verification

The U.S. Chamber of Commerce has a new paper out on electronic employment verification systems. Using government estimates, it finds that operating a nationwide worker background check system would cost $10 billion a year.

The Chamber is no opponent of requiring employers to check workers’ immigration status – I oppose the policy, preferring to live in a free country – but the paper has a lot of information about the practical impediments to giving the federal government a say in every hiring decision.

It also gives the last word to my paper, Electronic Employment Eligibility: Franz Kafka’s Solution to Illegal Immigration. In the paper, I discuss a method for verifying work eligibility under the current immigration law without creating a national identity system. It’s possible, but highly unlikely. As I say in my paper:

Unless the federal government can accept the risk of error and is willing to commit to lasting employment eligibility rules, it will require any internal enforcement program to use databases and tracking rather than just issuing cards that prove eligibility to work and nothing more. It will push Americans toward a national ID and worker surveillance system.

Democratic Math

As President Obama institutionalizes the permanent campaign, Democrats are using his mailing list and his organization to generate support for his massive spending hikes. Yesterday they announced to the media that they were delivering 642,000 pledges of support for the Obama budget to Capitol Hill. But Washington Post writer Dana Milbank asked a couple of questions and got some interesting answers:

At Democratic National Committee headquarters yesterday morning, party workers were loading minivans with Xerox boxes, each addressed to a different congressional office. It was a classic campaign canvassing operation – except that the next election is 19 months away. “Supporters of President Obama’s Budget to Hand Deliver 642,000 Pledges Gathered from Around the Country to Capitol Hill,” announced the Democrats’ news release.

CNN and the Huffington Post dutifully reported the DNC’s claim of 642,000 pledges. Network cameras and the BBC showed up to film the operation. “We had one of the big printers downstairs smoking last night,” party spokesman Brad Woodhouse said.

In fact, the canvassing of Obama’s vaunted e-mail list of 13 million people resulted in just 114,000 pledges – a response rate of less than 1 percent. Workers gathered 100,000 more from street canvassing. The DNC got to 642,000 by making three photocopies of each pledge so that each signer’s senators and representative could get one.

So they asked 13 million Obama supporters to support Obama’s budget, and got 114,000 responses – which might suggest that even Obama supporters aren’t excited about trillion-dollar deficits farther than the eye can see. And then they counted each one they did get three times to get a good number for the press release, which some of the media bit on. I wonder – if I count each tax dollar three times, can I send in $3,000 and have them count it as $9,000? After all, my two senators and my congressman will all get to spend it.

Obama vs. Ontario

The left-of-center government in Ontario, Canada’s largest province, is enacting dramatic corporate income tax (CIT) cuts. It announced last week that it is phasing in a reduction of the provincial CIT to 10 percent, which is paid on top of the federal rate that itself is falling to 15 percent. The combined rate of 25 percent will be far lower than the average U.S. federal/state rate of 40 percent.

The province is also eliminating sales taxes on business purchases, which will substantially reduce effective business tax rates.

As the Canadian Press reports, the cuts will make Ontario’s business tax rates much “lower than the average U.S. Great Lake state, considered Ontario’s main competitors for jobs and investment.”

Big Three auto companies, for example, may decide to close their U.S. plants over their numerous Ontario plants if they conclude that there will be a long-term Canadian tax advantage.

For its part, the Obama administration’s budget proposed a range of higher taxes on businesses, going in the exact opposite direction of virtually all other advanced economies.

McAuliffe-nomics

Good news for Virginia taxpayers! Turns out that gubernatorial candidate Terry McAuliffe, longtime Democratic fundraiser and former national chairman, understands the power of tax cuts. At a forum on Wednesday, he said that $1.25 million in tax cuts could generate $80 million in economic activity. I’m not sure even Art Laffer or Christina Romer would claim that much return on tax cuts. But here’s McAuliffe:

At George Mason University yesterday, McAuliffe said Virginia’s appeal to Hollywood filmmakers could improve the state’s economic picture. McAuliffe said he became familiar with the potency of the film industry while serving as chairman of the Democratic National Committee.

During a roundtable discussion with local filmmakers and producers at George Mason, he unveiled a proposal to offer additional tax incentives and other benefits to film crews making movies in Virginia. He said the state has been losing out to such states as North Carolina and Georgia, which offer greater benefits and have seen their film industries flourish.

He pointed to the HBO miniseries “John Adams,” about the nation’s second president, as an example of a film project that had benefited the state. The miniseries, filmed partly in Williamsburg and at the College of William and Mary, cost Virginia $1.25 million in tax breaks, but it boosted the local economy by $80 million and created 3,500 jobs, he said.

Unless … wait a minute. Could it be that McAuliffe only favors targeted tax cuts, tax cuts that would direct economic activity in a particular direction, tax cuts that would in fact help his Hollywood fundraising friends? Hard to say. He’s not calling for tax increases during his gubernatorial campaign, but of course he helped President Clinton raise taxes and he supports President Obama’s tax-spend-and-borrow policies. According to this liberal blogger, McAuliffe tells liberals privately that he can’t run for governor of Virginia on a tax-increase platform … if you get my drift.

But hey, if a $1.25 million tax break can generate $80 million of economic activity, what could a $125 million tax break do for Virginia?

New Study: ‘Drug Decriminalization in Portugal’

On July 1, 2001, a nationwide law in Portugal took effect that decriminalized all drugs, including cocaine and heroin. Drug possession for personal use and drug usage itself are still legally prohibited, but violations of those prohibitions are deemed to be exclusively administrative violations and are removed completely from the criminal realm.

In a new study, constitutional lawyer and Salon.com writer Glenn Greenwald examines the Portuguese model and the data concerning drug-related trends in Portugal, and argues that, “judged by virtually every metric, the Portuguese decriminalization framework has been a resounding success.”

Greenwald will speak at the Cato Institute Friday, April 3, about the success of the decriminalization program.

[ipaper docId=13784156 access_key=key-1b7m6y33q9et1f73i1st height=600 width=500 /]

Terrible Example, Mr. Secretary

Here’s something rich from U.S. Education Secretary Arne Duncan: According to The New York Times, yesterday Duncan smeared South Carolina Governor Mark Sanford as a reform obstructionist because Sanford wants to turn down education stimulus money.

“For South Carolina to stand on the sidelines and say that the status quo is O.K., that defies logic,” said Duncan.

That’s right, Duncan had the gall to frame as a protector of the status quo the same governor who for years has been crystal clear that schooling in his state is dismal and that school choice – which takes power away from politically ferocious, government-schooling special interests and gives it to parents – is the key to real change. It’s also the same desperately sought after reform, by the way, that President Obama and his education secretary are happy to let die a slow – but politically convenient – death in Washington, DC.

And what do Secretary Duncan and his boss have in mind for South Carolina? The same worthless, failed education “solutions” too many politicians have proffered for decades: spend ever more money and talk big about the better results you’ll “demand” but never get. That makes the politicians look like they care about “the children” while really rewarding the politically potent, school-choice-hating, accountability dodging unions, administrators and bureaucrats who live off the status quo and serve not the kids, but themselves.

So let’s get something straight, Mr. Secretary: If you want real change you actually have to do something different, something that attacks real problems, and with his crusade for educational freedom that’s exactly what Governor Sanford has been doing. In stark contrast, so far all the Obama administration has offered is a lot of bluster, and a lot more money for our hopeless education monopoly.  And that, Mr. Secretary, is truly acting like the status quo is O.K.

Former Prosecutor, Judge Calls for Drug Legalization

Many of those most involved in the drug war both at home and abroad recognize that it is an expensive failure, having had little impact of drug consumption while fostering crime and undermining civil liberties.  In fact, many former cops, prosecutors, and judges have joined together in Law Enforcement Against Prohibition.

A former Orange County, California prosecutor and judge who once locked up drug offenders now advocates relaxing the drug laws.  The Los Angeles Times has just published Steve Lopez’s interview with Jim Gray:

All right, tell me this doesn’t sound a little strange:

I’m sitting in Costa Mesa with a silver-haired gent who once ran for Congress as a Republican and used to lock up drug dealers as a federal prosecutor, a man who served as an Orange County judge for 25 years. And what are we talking about? He’s begging me to tell you we need to legalize drugs in America.

“Please quote me,” says Jim Gray, insisting the war on drugs is hopeless. “What we are doing has failed.”

As far as I can tell, Gray is not off his rocker. He’s not promoting drug use, he says for clarification. Anything but. If he had his way, half the revenue we would generate from taxing and regulating drugs would be plowed back into drug prevention education, and there’d be rehab on demand.

So here he is in coat and tie – with a U.S. flag lapel pin – eating his oatmeal and making perfect sense, even when talking about the way President Obama flippantly dismissed a question about legalizing marijuana last week during a White House news conference.

“Politicians get reelected talking tough regarding the war on drugs,” says Gray. “Do you want to hear the speech? Vote for Gray. I will put drug dealers in jail and save your children.”

I had gone to visit Gray in part to discuss his support for a bill introduced last month by Democratic San Francisco Assemblyman Tom Ammiano, who is calling for marijuana to be regulated and taxed much like alcohol.

There’s no good answer to drug abuse.  But turning a health problem into a criminal law problem certainly is not the answer.  It’s time to take the immense profit out of the drug market as have other countries, such as Portugal, which has decriminalized drug use.