Archives: 06/2009

Going Bankrupt Double-Quick

George W. Bush and the Republicans worked hard to ruin the U.S. government’s finances.  The Obama administration and the Democrats are doing an even better job of wrecking the Treasury.

Reports Bloomberg:

Treasuries headed for their second monthly loss, pushing 10-year yields up the most in almost six years, as President Barack Obama’s record borrowing spree overwhelmed Federal Reserve efforts to cap interest rates.

Notes, little changed today, also tumbled this week on speculation the worst of the economic recession is over. A private report today will show confidence among U.S. consumers gained in May for a third month, economists said. South Korea’s National Pension Service, the nation’s largest investor, plans to reduce the weighting of U.S. bonds in its holdings, the government said in a statement.

“It’s a disastrous market,” said Hideo Shimomura, who oversees $4 billion in non-yen bonds as chief fund investor at Mitsubishi UFJ Asset Management Co. in Tokyo, a unit of Japan’s largest bank. “I expected yields to rise but not this fast. We will see new highs in yields.”

The benchmark 10-year note yielded 3.61 percent at 6:29 a.m. in London, according to BGCantor Market Data. The 3.125 percent security due in May 2019 traded at a price of 95 30/32.

Ten-year rates rose about half a percentage point in May, extending an increase of 46 basis points in April. The two-month climb was the most since July and August of 2003. A basis point is 0.01 percentage point.

As borrowing costs rise, so will future deficits, requiring more borrowing, which will push up interest rates, hiking future deficits, requiring…

Just how are we going to finance trillions of dollars for health care reform while wrecking the economy with cap and trade?  And then there’s the $107 trillion in unfunded liabilities for Social Security and Medicare.

No Wrongdoing in the Calvo Raid?

Last year the Prince George’s County Sheriff’s Department SWAT Team raided the home of Berwyn Heights, Maryland Mayor Cheye Calvo. Police officers on the case knew that dealers were sending packages to random addresses so that accomplices in delivery companies could pick them up. The officers didn’t take the drugs out of circulation at the warehouse when they intercepted them. They simply sent them to the bogus address and raided it. The investigating officers did this without checking with local law enforcement officials, who probably would have told them that the mayor wasn’t a drug dealer and that they were barking up the wrong tree. The SWAT team shot and killed Mayor Calvo’s two dogs and caused significant property damage to his home before they got around to figuring out his (nonexistent) role in narcotics trafficking.

The Sheriff’s Office just cleared its deputies of any wrongdoing.

Radley Balko has a post up at Reason. His Cato study, Overkill: The Rise of Paramilitary Police Raids in America, shows that this is not an isolated incident. Check out the raidmap for more detail.

Mayor Calvo spoke at a Cato event in the wake of the raid, “Should No-Knock Police Raids be Rare-or Routine?” He tells his story below:

Bierfeldt v. Napolitano Roundup

Back on March 29th, Campaign for Liberty employee Steven Bierfeldt was leaving the Campaign’s regional conference in St. Louis, Missouri. He was carrying $4700 in cash donations and Campaign for Liberty and Ron Paul literature. TSA personnel at the St. Louis airport felt that carrying this amount of cash was “suspicious” and detained him for interrogation. The TSA personnel intended to take Bierfeldt to the local police station for further questioning after he refused to answer the questions associated with their fishing expedition. Luckily, a plainclothes officer arrived and spoke briefly with one of the TSA officers, who told Bierfeldt that he was free to go.

Bierfeldt is now filing suit against Secretary of the Department of Homeland Security Janet Napolitano. The ACLU Blog of Rights has more on the suit, including a digital copy of the complaint. Filing suit to prove that “[c]arrying $4700 in cash poses no conceivable threat to flight safety” is a sign that airport screening is going too far.

Bierfeldt was right to be wary of airport screening while carrying Ron Paul and Campaign for Liberty literature. The Missouri Information Analysis Center, one of 70+ “fusion centers” in the nation, had just released its report on domestic terrorism and the militia movement. Libertarians are expressly targeted as potential domestic terrorists:

Political Paraphernalia: Militia members most commonly associate with 3rd party political groups. It is not uncommon for militia members to display Constitutional Party, Campaign for Liberty, or Libertarian material. These members are usually supporters of former Presidential Candidate: Ron Paul, Chuck Baldwin, and Bob Barr.

Cato recently held a forum on this phenomenon, Fusion Centers: Domestic Spying or Sensible Surveillance? My colleague Tim Lynch hosted, and panelists included Bruce Fein, Constitutional Attorney, The Lichfield Group; Harvey Eisenberg, Chief, National Security Section, Office of United States Attorney, District of Maryland; and Michael German, Policy Counsel, American Civil Liberties Union. Audio and video are available at the link.

Mike German has written extensively on this topic. Read his November 2007 report, What’s Wrong with Fusion Centers and July 2008 update. Mike is a former FBI agent and author of the excellent book, Thinking Like a Terrorist.

You can watch Mr. Bierfeldt giving his side of the story to Judge Andrew Napolitano (no relation to Homeland Secretary Janet Napolitano) on Fox’s Freedom Watch.

Judge Napolitano recently spoke at the Cato book forum, Dred Scott’s Revenge: A Legal History of Race and Freedom in America. Co-panelists included my colleague Jason Kuznicki and Reason’s Damon Root.

“It’s a Lot Easier to Promise to Change Washington Than It Is to Actually Change It”

The New York Times has an interesting story on President Obama’s continuing failure to follow through on his “Sunlight Before Signing” promise. On the campaign trail, he said he would post bills online for five days before signing them. Two dozen bills now have his signature, and only one has been posted for five days before signing.

The article (and accompanying video) fixes on a couple of reasons why the president might be excused from carrying out the promise. One is the technical difficulty of managing potentially hundreds of thousands of comments. The promise did not include a promise to publish comments, though – much less to read them (though it would be politically astute to appear to do so). In my view, the difficulty of administering a public comment system – which was not part of the promise – does not excuse the failure to post the bills Congress presents to the president for five days before he signs them.

A second excuse is that posting bills online would be ineffectual. Ellen Miller of the Sunlight Foundation is quoted saying, “There isn’t anybody in this town who doesn’t know that commenting after a bill has been passed is meaningless.”

I have done my level-best to illustrate how a five-day hold at the White House would have good effects on reducing earmarks, parochial amendments, and other shenanigans – such as congressional approval of bonuses to AIG executives.

Miller’s preferred approach – placing a similar hold on bills before they leave Congress – would have a similar effect – but nothing dramatically more open. Just as under a presidential hold, members of Congress and Senators would be more reticent to introduce potentially controversial amendments. Just as under a presidential hold, they would carefully avoid a blossoming of debate about their pet projects at the end of the legislative process. A congressional hold would change the upstream behavior of the politicians – just like a presidential hold would.

A presidential hold and a congressional hold are both good ideas, and they are not mutually exclusive. The presidential hold has a key advantage: The president has already promised it – to the cheers of American voters.

The New York Times story reports a small step toward meeting the actual terms of President Obama’s pledge:

“In order to continue providing the American people more transparency in government, once it is clear that a bill will be coming to the president’s desk, the White House will post the bill online,” said Nick Shapiro, a White House spokesman. “This will give the American people a greater ability to review the bill, often many more than five days before the president signs it into law.”

If this means posting links to bills on the Thomas legislative system from Whitehouse.gov, this is something the White House has done sporadically, and it would increase transparency by a small margin if it were regularized. The administration should establish a uniform URL where bills are posted so that every American can easily find every bill the president signs. But, in terms of fulfilling President Obama’s promise, “posting a link from WhiteHouse.gov to THOMAS of a conference report that is expected to pass doesn’t cut it.”

I think this is grudging progress toward implementation of President Obama’s “Sunlight Before Signing” promise. In the video, the author of the Times article has the best line illustrating why the White House deserves modest congratulations for taking this step: “It’s a lot easier to promise to change Washington than it is to actually change it.”

Uncle Sam a Generous Boss

Federal unions, government officials, and the Washington Post’s “Federal Diary” column frequently suggest that federal civilian workers are underpaid. They suffer from a large “pay gap” compared to private sector workers, or so the story goes.

But in the Post’s “Jobs” section yesterday, human resources specialist Lily Garcia argues that “Uncle Sam Is a Boss You Can Rely On.” For job seekers, Garcia points to the many advantages of federal work:

  • “Generous benefits, solid pay, and relative job security – a combination that is challenging to find in the private sector, even in the best of times.”
  • The “widest selection of health-care plans of any U.S. employer.”
  • “Liberal amounts of paid time off.”
  • Very lucrative retirement benefits.
  • Family-friendly policies such as “first priority and subsidies at a number of top-notch day-care facilities.”
  • “Federal employees are paid relatively well … [and] practically guaranteed periodic within-grade pay raises.”
  • Finally, “federal employees cannot be unceremoniously fired.” I’ve found that only about 1 in 5,000 federal civilian workers are fired each year due to poor performance. 

Is the lack of firing a result of the superb quality of the federal workforce and superior management practices? Hardly. Garcia notes that the downside of working for Uncle Sam is that the government “has its fair share of bullies, sycophants and incompetents who pick on employees, display favoritism, mismanage operations and find creative ways to manipulate the rules to their advantage.” I’d guess more than its fair share. Since federal workers are rarely fired, the ranks of non-performing managers and workers grows over time, contributing to the bureaucratic ineptitude we are all familiar with in the federal government.

To improve workforce efficiency, I’ve suggested privatizing as many federal activities as possible, include postal services, air traffic control, and passenger rail. To cut costs, I’ve suggested a federal wage freeze and a cut in federal benefits as part of a plan to reduce federal budget deficits.  

For more from Lily Garcia, see here. For more from me, see here.

The White House as Animal Farm

As George Orwell’s Animal Farm closes, the revolutionary pigs have been transformed into oppressive humans.  It took some time to occur on the Animal Farm.  It’s taken just a few months in the Obama White House.

Reports McClatchy Newspapers:

President Barack Obama is morphing into George W. Bush, as administration attorneys repeatedly adopt the executive-authority and national-security rationales that their Republican predecessors preferred.

In courtroom battles and freedom-of-information fights from Washington, D.C., to California, Obama’s legal arguments repeatedly mirror Bush’s: White House turf is to be protected, secrets must be retained and dire warnings are wielded as weapons.

“It’s putting up a veritable wall around the White House, and it’s so at odds with Obama’s campaign commitment to more open government,” said Anne Weismann, chief counsel for Citizens for Responsibility and Ethics in Washington, a legal watchdog group.

Certainly, some differences exist.

The Obama administration, for instance, has released documents on global warming from the Council on Environmental Quality that the Bush administration sought to suppress. Some questions, such as access to White House visitor logs, remain a work in progress.

On policies that are at the heart of presidential power and prerogatives, however, this administration’s legal arguments have blended into the other. The persistence can reflect everything from institutional momentum and a quest for continuity to the clout of career employees.

“There is no question that there are (durable) cultures and mindsets in agencies,” Weismann acknowledged.

Conservatives once opposed executive aggrandizement.  Then with George W. Bush in office, they embraced the idea of the presidency as a kind of elective monarchy.  With President Barack Obama now pushing the executive power grab, will conservatives rediscover their inner-Constitution and again join the barricades for liberty?

New Technology Charts Old Repression

The fact that North Korea is a monstrous tyranny is well-known.  Google Earth is helping map that tyranny in extraordinary detail, from the opulent palaces of the elite to the horrid labor camps for the victims. 

Reports The Independent:

US researchers are using the internet to reveal what life is really like behind the closed borders of the world’s last Stalinist dictatorship

The most comprehensive picture of what goes on inside the secret state of North Korea has emerged from an innovative US project. The location of extraordinary palaces, labour camps and the mass graves of famine victims have all been identified. The online operation that has penetrated the world’s last remaining iron curtain is called North Korea Uncovered. Founded by Curtis Melvin, a postgraduate student at George Mason University, Virginia, it uses Google Earth, photographs, academic and specialist reports and a global network of contributors who have visited or studied the country. Mr Melvin says the collaborative project is an example of “democratised intelligence”. He is the first to emphasise that the picture is far from complete, but it is, until the country opens up, the best we have.

Palaces

The palatial residences of the political elite are easy to identify as they are in sharp contrast to the majority of housing in the deeply impoverished state. Though details about many palaces’ names, occupants and uses are hard to verify, it is known that such buildings are the exclusive domain of Kim Jong-Il, his family and his top political aides. Kim Jong-Il is believed to have between 10 and 17 palaces, many of which have been spotted on Google Earth:

1) Mansion complex near Pyongyang

This may be Kim Jong-Il’s main residence. His father lived here surrounded by the huge, ornate gardens and carefully designed network of lakes. Tree-lined paths lead to a swimming pool with a huge water slide, and next to the complex there is a full-size racetrack with a viewing stand and arena. There is a cluster of other large houses around the mansion, forming an enclosed, elite community. It appears to be reached via an underground station on a private railway which branches off from the main line.

The new technology is creating a new variant to the old saying:  you can run, but you can’t hide.  Tyrants can run their countries but they can’t hide their abuses.

We still have yet to figure out how to toss thugs like Kim Jong-il into history’s trashcan.  But better understanding their crimes is an important part of the process.