Archives: 09/2010

Criminals on the Police Force

The standard line from police departments is that they “vigorously investigate every allegation of police misconduct.”  That is something we want to hear and believe, but it is not always the case. 

Can you imagine a friend or relative getting beaten up and pistol whipped for no good reason by an off-duty cop and then seeing the victim prosecuted for crimes?  Can you imagine a police department where the honest officers are harassed into supporting cops who break the law?  Well those are the basic findings of a federal judge in Kansas City.  A DEA agent, in a fit of road rage, pulls over one Barron Bowling,  and proceeds to beat him up.  When other cops arrive on the scene, the cover-up begins–they omit witness statements from persons who contradict the account of the DEA agent.  And Detective Max Seifert gets harassed by his peers for not playing along with the fabricated cover story.

The bad apples within the department move up while the honest detectives are hounded out of the organization.  Read the whole sordid story here.

Designing an Insecure Internet

If there were any doubt that the 90s are back in style, witness the Obama administration’s attempt to reignite the Crypto Wars by seeking legislation that would force Internet services to redesign their networks and products to provide a centralized mechanism for decrypting user communications. It cannot be stressed enough what a radical—and terrible—idea this is.  I’ll be writing on this at greater length this week, but a few quick points.

First, while the Communications Assistance for Law Enforcement Act (CALEA) already requires phone and broadband providers to build in interception capacity at their network hubs, this proposed requirement—at least going on the basis of the press description, since there’s no legislative text yet—is both broader and more drastic. It appears that it would apply to the whole panoply of online firms offering secure communication services, not just big carriers, imposing a greater relative burden. More importantly, it’s not just mandating that already-centralized systems install a government backdoor. Rather, if I understand it correctly, the proposal would insist on a centralized (and therefore less secure) architecture for secure communications, as opposed to an end-to-end model where encryption is handled client-side. In effect, the government is insisting on the right to make a macro-design choice between competing network models for thousands of companies.

Second, they are basically demanding that providers design their systems for breach. This is massively stupid from a security perspective.  In the summer of 2004, still unknown hackers exploited surveillance software built in to one of Greece’s major cell networks to eavesdrop on high government officials, including the prime ministers. The recent hack of Google believed to originate in China may have used a law-enforcement portal to acquire information about dissidents. More recently, we learned of a Google engineer abusing his access to the system to spy on minors.

Third, this demand has implications beyond the United States. Networks designed for interception by U.S. authorities will also be more easily tapped by authoritarian governments looking to keep tabs on dissidents. And indeed, this proposal echoes demands from the likes of Saudi Arabia and the United Arab Emirates that their Blackberry system be redesigned for easier interception. By joining that chorus, the U.S. makes it more difficult for firms to resist similar demands from unlovely regimes.

Finally, this demand highlights how American law enforcement and intel agencies have been circumventing reporting requirements designed to provide information on this very problem. As the Crypto Wars of the 90s drew to a close, Congress amended the Wiretap Act, which creates strong procedural protections when the government wants to use intrusive electronic surveillance, to add a requirement that agencies report each instance in which they’d encountered encryption.  The idea was to get an objective measure of how serious a problem this posed. The most recent report, however, cited only one instance in which encryption was encountered, out of 2,376 wiretap orders. Why, then, are we now being told encryption is a huge problem? Almost certainly because law enforcement and intelligence agencies aren’t using the Wiretap Act to intercept electronic communications—preferring, instead, to avail themselves of the far more lax standards—and spare reporting requirements—provided by the Stored Communications Act.  It’s always easier to claim you need sweeping new powers from Congress when you’ve managed to do an end-run around the provisions Congress put in place to keep itself informed about how you’re using your existing powers, after all.

Eat Your Vegetables — If You Want To

This morning’s question at Politico Arena is:

The New York Times reports that despite two decades of public health initiatives Americans still aren’t eating enough vegetables. Healthy eating is a priority of First Lady Michelle Obama. Should those of us with less than Olympic-calibre physiques heed the first lady’s dietary advice? Does this smack of Big Brother – or more precisely Big Sister – wading into personal decisions? Could voluntary preferences on food issues morph into government mandates?

Of all the “Washington elites” they surveyed, I was almost the only one to express skepticism about the First Lady’s and the New York Times’s expectations for the rest of us:

I was struck by that New York Times article on Saturday. The headline is “Told to Eat Its Vegetables, America Orders Fries.” We Americans are just a constant trial to our elites. We cling not only to our religion and our guns but to our French fries. The government has TOLD us to eat vegetables, and yet we persist in eating tasty food. Soon we may be sent to our rooms without supper.

And then the reporter wrote, in this news story, “Despite two decades of public health initiatives, stricter government dietary guidelines, record growth of farmers’ markets and the ease of products like salad in a bag, Americans still aren’t eating enough vegetables.” America to the New York Times reporting staff: We’ll decide the proper tradeoff between taste, price, nutrition and so on. “Enough vegetables” is a subjective decision, not a fact.

More fundamentally, Why is it any of the federal government’s business how fit we are? We don’t need a national nanny.

The federal government has an important role in our society. Its primary function is national security, and it hasn’t been doing a very good job. It should focus on that.

Americans know that first they say you “should,” and the next thing you know they want to make it mandatory. Already people are talking about taxing junk food. And they’re filing suit against fast-food companies.

We teach our kids to take responsibility for themselves and to Mind Your Own Business – the government should take that advice.

A lot of this is old-fashioned American Puritanism – the idea that anything you enjoy is bad for you– so they tell us don’t smoke, don’t drink, don’t eat, recycle, practice safe sex, ride that bicycle.

A subversive page editor at the New York Times inserted a pull quote (in the print edition) reading “Besides, the taste, trouble and cost, what’s the problem?” Exactly. We Americans are sorry for being such a disappointment to the first lady and the New York Times. But not that sorry.

Why Are We Paying $100 Million to International Bureaucrats in Paris so They Can Endorse Obama’s Statist Agenda?

There’s a wise old saying about “don’t bite the hand that feeds you.” But perhaps we need a new saying along the lines of “don’t subsidize the foot that kicks you.” Here’s a good example: American taxpayers finance the biggest share of the budget for the Organization for Economic Cooperation and Development, which is an international bureaucracy based in Paris. The OECD is not as costly as the United Nations, but it still soaks up about $100 million of American tax dollars each year. And what do we get in exchange for all this money? Sadly, the answer is lots of bad policy. The bureaucrats (who, by the way, get tax-free salaries) just released their “Economic Survey of the United States, 2010” and it contains a wide range of statist analysis and big-government recommendations.

The Survey endorses Obama’s failed Keynesian spending bill and the Fed’s easy-money policy, stating, “The substantial fiscal and monetary stimulus successfully turned the economy around.” If 9.6 percent unemployment and economic stagnation is the OECD’s idea of success, I’d hate to see what they consider a failure. Then again, the OECD is based in Paris, so even America’s anemic economy may seem vibrant from that perspective.

The Survey also targets some very prominent tax loopholes, asserting that, “The mortgage interest deduction should be reduced or eliminated” and “the government should reduce further this [health care exclusion] tax expenditure.” If the entire tax code was being ripped up and replaced with a simple and fair flat tax, these would be good policies. Unfortunately (but predictably), the OECD supports these policies as a means of increasing the overall tax burden and giving politicians more money to spend.

Speaking of tax increases, the OECD is in love with higher taxes. The Paris-based bureaucrats endorse Obama’s soak-the-rich tax agenda, including higher income tax rates, higher capital gains tax rates, more double taxation of dividends, and a reinstated death tax. Perhaps because they don’t pay tax and are clueless about how the real world operates, the bureaucrats state that “…the Administration’s fiscal plan is ambitious…and should therefore be implemented in full.”

But even that’s not enough. The OECD then puts together a menu of additional taxes and even gives political advice on how to get away with foisting these harsh burdens on innocent American taxpayers. According to the Survey, “A variety of options is available to raise tax revenue, some of which are discussed below. Combined, they have the potential to raise considerably more revenue… The advantage of relying on a package of measures is that the increase in taxation faced by individual groups is more limited than otherwise, reducing incentives to mobilise to oppose the tax increase.”

The biggest kick in the teeth, though, is the OECD’s support for a value-added tax. The bureaucrats wrote that, “Raising consumption taxes, notably by introducing a federal value-added tax (VAT), could therefore be another approach… A national VAT would be easier to enforce than other taxes, as each firm in the production chain pays only a fraction of the tax and must report the sales of other firms.”

But just in case you think the OECD is myopically focused on tax increases, you’ll be happy to know it is a full-service generator of bad ideas. The Paris-based bureaucracy also is a rabid supporter of the global-warming/climate-change/whatever-they’re-calling-it-now agenda. There’s an entire chapter in the survey on the issue, but the key passages is, “The current Administration is endeavouring to establish a comprehensive climate-change policy, the main planks of which are pricing GHG emissions and supporting the development of innovative technologies to reduce GHG emissions. As discussed above and emphasized in the OECD (2009), this is the right approach… Congress should pass comprehensive climate-change legislation.”

You won’t be surprised to learn that the OECD’s reflexive support for higher taxes appears even in this section. The bureaucrats urge that “such regulation should be complemented by increases in gasoline and other fossil-fuel taxes.”

If you’re still not convinced the OECD is a giant waste of money for American taxpayers, I suggest you watch this video released by the Center for Freedom and Prosperity about two months ago. It’s a damning indictment of the OECD’s statist agenda (and this was before the bureaucrats released the horrid new “Economic Survey of the United States”).

Is It ‘Weird’ for Congress to Consider the Constitutionality of Legislation Before Voting on It?

Slate columnist Dahlia Lithwick seems to think so (h/t David Bernstein).  So I’m not accused of taking Lithwick’s words out of context, here’s the relevant passage, discussing Senate nominee Christine O’Donnell (R-DE):

O’Donnell explained that “when I go to Washington, D.C., the litmus test by which I cast my vote for every piece of legislation that comes across my desk will be whether or not it is constitutional.” How weird is that, I thought. Isn’t it a court’s job to determine whether or not something is, in fact, constitutional? And isn’t that sort of provided for in, well, the Constitution? In 2003, O’Donnell said of the Supreme Court that “it’s kind of like we have the nine people sitting there in Washington who have a constitutional monarchy and that is an abuse of the system.” So I do wonder a little whether she’s claiming that her view of what’s constitutional trumps theirs. Not a lot of space for checks and balances in that reading.

Apparently Lithwick doesn’t know that senators and congressmen (and a whole host of other officials – including federal law clerks of the kind both she and I were at some point) swear an oath to uphold the Constitution.  It seems that it would be hard to fulfill that oath if you don’t in good faith and to the best of your ability consider the constitutional dimension of whatever you’re voting on.  Yes of course not all congressmen are lawyers – though it’s unclear whether being one and even chairing the judiciary committee helps one think through constitutional issues – but you shouldn’t have to be a constitutional scholar to see that, for example, Congress cannot force everyone to eat three servings of fruits and vegetables daily.  (Though now-Justice Elena Kagan refused to say that.)

Indeed, the Constitution is silent as to which branch of government is to review the constitutionality of legislation.  Moreover, as we know from the foundational case of Marbury v. Madison, the judiciary’s role in doing so is merely (but rightly) implied, not explicit, in constitutional text.  There is no “weirdness” in courts exercising their constitutional powers by ruling on constitutional issues brought before them in lawsuits even as the other branches make constitutionality determinations in carrying out their own duties.  After all, isn’t a president who does something he consciously knows is beyond his lawfully vested Article II authority violating his own oath of office and potentially subjecting himself to impeachment for that very reason?

Yes, long gone, unfortunately, are the days when congressional debates focused on the constitutionality of proposed bills rather than their desirability, but shouldn’t Congress at least pay lip service to the idea that it needs a constitutional warrant for everything it does?

In any event, I’ll be on a panel with Dahlia this Thursday at the Missouri Bar Association’s annual meeting and will raise this issue to her.  (May also take on her bizarre accusation that Iowa Senator Chuck Grassley was appealing sub rosa to “Christian Reconstructionists” in asking at Kagan’s confirmation hearings whether the right to keep and bear arms pre-existed the Constitution – see David Bernstein’s simple rebuttal at the Volokh Conspiracy.)

Warren Buffett: Good Investor, Crummy Economist

Warren Buffett once said that it wasn’t right for his secretary to have a higher tax rate than he faced, leading me to point out that he didn’t understand tax policy. The 15 percent tax rates on dividends and capital gains to which he presumably was referring represents double taxation, and when added to the tax that already was paid on the income he invested (and the tax that one imagines will be imposed on that same income when he dies), it is quite obvious that his effective marginal tax rates is much higher than anything his secretary pays. Though he is right that his secretary’s tax rate is much too high. 
 
Well, it turns out that Warren Buffett also doesn’t understand much about other areas of fiscal policy. Like a lot of ultra-rich liberals who have lost touch with the lives of regular people, he thinks taxpayer anger is misguided. Not only does he scold people for being upset, but he regurgitates the most simplistic Keynesian talking points to justify Obama’s spending spree. Here’s an excerpt from his hometown paper.

Taxpayer anger against President Barack Obama and Congress is counterproductive because policy makers took measures including deficit spending to stimulate the economy, billionaire investor Warren Buffett told CNBC. …“I hope we get over it pretty soon, because it’s not productive,’’ Buffett said. “We will come back regardless of how people feel about Washington, but it is not helpful to have people as unhappy as they are about what’s going on in Washington.” …“The truth is we’re running a federal deficit that’s 9 percent of gross domestic product,” Buffett said. “That’s stimulative as all get out. It’s more stimulative than any policy we’ve followed since World War II.”

About the only positive thing one can say about Buffett’s fiscal policy track record is that he is nowhere close to being the most inaccurate person in the United States, a title that Mark Zandi surely will own for the indefinite future.

Cuban Government Will Choke the Nascent Private Sector

Following the announcement of massive layoffs in the public sector, the Cuban government published today new guidelines that will allow private employment in 178 economic activities. Among the newly authorized private occupations are masseurs, clowns, shoemakers, locksmiths, and gardeners.

However, these new entrepreneurs will face a few hurdles before enjoying the benefits of their own work. Not only must they get a government license in order to operate (according to official sources the number of permits will be capped at 250,000), but they will also have to pay high taxes. A leaked document from the Communist Party says that small businesses will pay between 10 to 40 percent of their gross income in taxes. On top of that, they will have to contribute 25 percent of their incomes to social security.

Don’t expect a thriving private sector in Cuba any time soon.