Archives: February, 2013

Those Phantom Spending ‘Cuts’ from 2011

The Washington Post’s David Fahrenthold recently took a look at the $38 billion in spending cuts that Republicans and Democrats agreed to in 2011 in order to avoid a government shutdown. Fahrenthold estimates that $17 billion of those “cuts” were little more than budgetary gimmicks. For instance, $6 billion in authorized spending for the previous year’s decennial census were merely wiped off the books and counted as a “cut.” 

Fahrenthold’s piece is a good reminder of how unserious politicians from both parties are about cutting spending. But I want to make two additional points. 

First, real or not, let’s not forget that the $38 billion in “cuts” were a drop in the bucket that year compared to total spending, the deficit, and even interest on the debt: 

 

Second, unless entire agencies or programs are terminated, spending cuts will probably end up only being temporary. Following the 2011 agreement, I demonstrated this by noting that many of the programs that were cut were also cut in a 1995 deal: 

Agricultural Research Service, Animal & Plant Health Inspection Service, Rural Development programs, Women, Infants & Children, Foreign Agricultural Service, National Institute of Standards & Technology, National Oceanic & Atmospheric Administration, Economic Development Administration, National Telecommunications & Information Administration, Small Business Administration, State Department foreign aid, Fund for African Development, International Development assistance, Economic Support Fund, Peacekeeping Operations, Trade Development Agency, Army Corps of Engineers, Bureau of Land Management, Fish and Wildlife Service, National Park Service, Bureau of Reclamation, National Forest System, Appalachian Regional Commission, Department of Energy administration, Fossil Energy Research & Development, energy conservation programs, National Endowment for the Arts, National Endowment for the Humanities, National Gallery of Art, Community Service Employment for Older Americans, National Institutes of Health, Centers for Disease Control, Low Income Home Energy Assistance, Administration on Aging, Youthbuild, Adult Education, programs for K-12 and higher education, Corporation for Public Broadcasting, Federal Aviation Administration, Federal Highway Administration, rail subsidies, Federal Transit Administration, Financial Management Service, Veterans Affairs construction projects, Housing Counseling Assistance, public housing programs, Community Development Financial Institutions Funds, Corporation for National & Community Service, Legal Services Corporation, Environmental Protection Agency, National Aeronautics & Space Administration, and the National Science Foundation. 

They were all cut in 1995 under a rescissions package engineered by then-Speaker Newt Gingrich and cut last week in the budget agreement reached by Republican and Democratic leaders. 

The lesson here is that there’s a big difference between spending cuts and terminating entire agencies and their programs. Like the mythological Hydra, the stump has to be burned after the head is cut off or else it’ll grow back.

U.S.-EU Free Trade Agreement? A Pep Talk or Overhaul at USTR Is the Place to Start

In its first 49 months, the Obama adminstration has paid lip service to trade liberalization. There have been the announcements, the platitudes, the initiatives, the task forces, and the interminable negotiations, but no new trade agreements. Not one. Still, in his State of the Union speech tonight, the president will offer assurances that his rhetorical commitment to trade liberalization remains steadfast, when he announces grand plans to pursue a trans-Atlantic free trade deal. Of course, rhetorical commitments and pursuing free trade don’t exactly get the job done.

Whether anything comes of prospective U.S.-EU trade negotiations or the still-brewing Trans-Pacific Partnership negotiations depends, more than anything else, on whether President Obama believes his own rhetoric. Of course, actions speak louder than words and on that score things don’t look especially promising.

Exhibit A is the Office of the U.S. Trade Representative, where employee morale has gone from bad to worse. In a 2012 OPM survey of 29 small federal agencies published in a report titled “Best Places to Work in the Federal Government,” USTR ranked dead last. The results showed employee dissatisfaction with their jobs, their organization, and their senior leadership.

The overall weighted index score of 32.7 (out of a possible 100) in 2012 is the latest point in a continuous and steep decline in satisfaction, which was 74.2 in 2009, 57.4 in 2010, and 47.7 in 2011. The sub-index for “Effective Leadership - Senior Leaders” declined from 71.2 to 49.7 to 37.5 to 18.6 over those same four years. Only 17.7 percent of the 101 USTR respondents said they had a high level of respect for their organization’s senior leaders, while 62.1 dissented from that view. Only 12.8 percent of 102 USTR respondents said their organization’s leaders generate high levels of motivation and commitment in the workforce, while 67.3 dissented.

These are some profound rebukes of U.S. Trade Representative Ron Kirk, and by extension, President Obama.

Live Blog of the 2013 State of the Union Address and the GOP Response

Please join us at 9:00PM ET on Tuesday, February 12, for live commentary during President Obama’s State of the Union address, the GOP response by Sen. Marco Rubio, and the Tea Party response by Sen. Rand Paul. Here is our panel of policy experts by research area:

General Comment and the Presidency:

Banking and Financial Regulation:

  • Mark Calabria, Director of Financial Regulation Studies (@MarkCalabria)

Infrastructure and Fiscal Policy:

Law and Civil Liberties:

Telecom and Information Policy:

  • Jim Harper, Director of Information Policy Studies (@Jim_Harper)

Health Care:

Immigration:

Education:

  • Andrew Coulson, Director - Center for Educational Freedom (@Andrew_Coulson)
  • Neal McCluskey, Associate Director - Center for Educational Freedom (@NealMcCluskey)

Energy and Environment:

  • Patrick J. Michaels, Director - Center for the Study of Science (@CatoMichaels)
  • Chip Knappenberger, Assistant Director - Center for the Study of Science (@PCKnappenberger)

Foreign Policy and National Security:

Follow their comments directly on Twitter, or come back to this page at 9:00 PM ET on Tuesday, February 12, to join us. We look forward to having you, and sharing our insights with you.

You can also follow the conversation on Twitter by following @CatoInstitute and the hashtag #SOTU.

Also watch Cato’s Libertarian State of the Union.

Ed Glaeser Makes Lamentably Rare Case for the Freedom to Trade

Support for free trade, especially from politicians, often rests on tired mercantalist arguments about the benefits of exports and jobs. That can backfire, as we’ve seen recently with trade figures showing that the U.S. trade deficit with Korea has widened since the Korea-U.S. Free Trade Agreement came into force. That’s why I’ve argued that relying on rhetoric about all the exports and jobs that free(r) trade will create is a dangerous game: where, might trade skeptics ask, are all those exports you promised us, and why should we support trade liberalization if the results we were promised don’t materialize? So I was thrilled today to see a small post on Bloomberg.com from Harvard economics professor Ed Glaeser calling for the president to make a strong push for a U.S.-EU trade agreement, because of the benefits it would bring U.S. companies and consumers:

He should use his address to make the U.S. a leading voice once again for economic freedom: the freedom of consumers to buy European goods and the freedom of producers to sell their goods on the other side of the Atlantic.

It is gratifying to see a principled case for free trade, resting on a foundation of freedom, in the media. Here’s hoping President Obama read Professor Glaeser’s article, and heeds his advice.

Sunlight Before Signing in Obama’s First Term

Sunlight Before Signing” was President Obama’s 2008 campaign promise to put all bills Congress sent him online for five days before signing them. It was a measurable promise that I’ve monitored here since the beginning of his first term, and I will continue to do so in his second.

It was the president’s first broken promise, and in the first year he broke it again with almost every new law, giving just six of the first 124 bills he signed the exposure he promised.

With his first term concluded last month, we can now assess how well the president did with Sunlight Before Signing. Compliance with the promise got better, but it’s still not great. The president gave 413 of 665 bills five days of public review (and one he acceptably did not give five days due to emergency).

The easy bills almost always got five days review—few bills to rename post offices haven’t gotten sunlight. But more important bills often didn’t. Recent examples are the controversial FISA Amendments Act Reauthorization and the “fiscal cliff” bill.

  Number of Bills Emergency Bills Bills Posted Five Days %
2009 124 0 6 4.8%
2010 258 1 186 72.4%
2011 90 0 55 61.1%
2012 193 0 166 86.0%
Overall 665 1 413 62.3%

Would five days of public review have magically produced transparent government? Of course not. But imagine if the president had implemented and enforced his five-day promise from the beginning, and with every law.

The Second Amendment Protects Both Keeping and Bearing Arms

Even before its recent enactment of ill-advised and (at least partially) unconstitutional gun-control measures, New York was no stranger to draconian restrictions on the right to keep and bear arms. The Empire State, like most states, requires a license to carry a handgun outside of one’s home, but differs from many by requiring prospective licensees to show “proper cause” before obtaining a license. State officials have broad discretion in finding such proper cause, which for non-celebrities typically requires proof of extraordinary personal danger documented by threats to one’s life — effectively leaving criminals, bodyguards, and retired law enforcement officers as the only armed civilians in public places.
 
Unable to make such a showing and thus denied licenses, a diverse group of New Yorkers, represented by Alan Gura — who successfully argued District of Columbia v. Heller (2008) and McDonald v. Chicago (2010) at the Supreme Court — filed suit in federal court challenging the constitutionality of the licensing scheme. Both the district court and the U.S. Court of Appeals for the Second Circuit upheld the law after purportedly applying “intermediate scrutiny,” which allows a challenged statute to survive only if it is “substantially related to the achievement of an important governmental interest.”
 
But the Second Circuit gave short thrift to the Second Amendment, treating New York’s restrictions as garden-variety legislation rather than measures infringing on a core constitutional right. In legal terms, the court effectively employed “rational-basis review,” which simply requires legislation to be rationally related to a legitimate government interest. Instead of requiring the state to show that its restriction on carrying firearms for basic self-defense has some concrete connection to public safety and crime prevention, the court deferred to the political branches by finding that assessing “the risks and benefits of handgun possession” and creating licensing schemes are “precisely the type of discretionary judgment[s] that officials in the legislative and executive branches of state government regularly make.”
 
The plaintiffs have now asked the Supreme Court to review that ruling and provide guidance to all lower courts regarding how to evaluate laws in tension with the Second Amendment. Today, Cato filed a brief supporting that petition. Like any constitutional right, the Second Amendment has no force absent a clear jurisprudential doctrine that ensures its enforcement. While the Second Circuit has applied a very deferential standard, other courts have expounded different doctrines since the Supreme Court ruled in Heller that the Second Amendment protects an individual right. For example, the Chicago-based Seventh Circuit demands that a restriction on Second Amendment rights satisfy a heightened level of scrutiny that requires “an extremely strong public-interest justification and a close fit between the government’s means and its end.” Given divergent lower-court rulings and the current political climate, the Second Amendment is in dire need of a clarified and robust standard of review — much like that afforded other constitutional rights, requiring federal and state governments to prove that laws infringing those rights are narrowly tailored to serve a compelling interest. Whatever the standard of review may ultimately turn out to be, Kachalsky v. Cacacse provides an excellent vehicle for the Supreme Court to pronounce it — and to show that the Second Amendment protects more than the right to keep a gun in one’s home.

Galileo, Gopnik, and Liberalism

Galileo was born 449 years ago, which is reason enough for the publication of several books about him in 2013. In the New Yorker, Adam Gopnik has a great review-essay about Galileo, his trial, and the new books. I’m intrigued by the argument he presents that Galileo could have avoided a lot of trouble if he’d been just a little less stubborn and impolitic. Gopnik defends “the originality of the scientific revolution.” He talks about Galileo’s authorship of “the most entertaining classic of science ever published.” He even throws in an apropos Milton Friedman reference. Perhaps most impressively, he does a good job of helping us understand the perspective of the church hierarchy, which seems so foreign to our modern liberal sensibilities.  

If only he would work as hard to understand and present the views of modern market liberals.