Archives: 11/2013

Race Has Nothing to Do with the Judicial Nominations Fight

The Congressional Black Caucus has now explicitly attacked Republicans as racist for blocking President Obama’s latest judicial nominees. Not only are they racist, but if you scratch them, you find Confederate gray. 
 
Unbelievable. 
 
Do these elected officials really think that the filibustering of three D.C. Circuit nominees (one of whom is black) has more to do with race than either judicial philosophy or the ongoing battle over whether this underworked court actually needs more judges? Even after Indian-American Sri Srinivasen was confirmed to that same court unanimously in May after Caitlin Halligan (who’s white) was blocked for ideological reasons?
 

Yellen and the Fed

The Senate Banking Committee just voted 14 to 8 to confirm Janet Yellen’s nomination to be the new Chair of the Federal Reserve. She will likely go on to be confirmed by the full Senate.

Much of the coverage has focused on Yellen as a person, when the real story is on the Fed as an institution. Sometimes individuals have profound influence on Fed policy, such as Paul Volcker  in the late 1970s and 1980s. Over time, however, the institutional structure of the central bank and the incentives facing policymakers matter more.

The Federal Reserve famously has a dual mandate of promoting maximum employment and price stability. The Federal Open Market Committee, which sets monetary policy, has great discretion in weighting the two policy goals. As a practical matter, the vast majority of the time, full employment receives the greater weight. That is because the Fed is subject to similar pressures as are the members of Congress to which the Fed must report. In the short run, voters want to see more job creation. That is especially true today. The United States is experiencing weak growth with anemic job creation.

Never mind that the Fed is not capable of stimulating job creation, at least not in a sustained way over time. It has a jobs mandate and has created expectations that it can stimulate job growth with monetary policy. The Fed became an inflation-fighter under Volcker only when high inflation produced strong political currents to fight inflation even at the cost of recession and job creation.

The Federal Reserve claims political independence, but it has been so only comparatively rarely. Even Volcker could make tough decisions only because he was supported by President Carter, who appointed him, and President Reagan, who reappointed him. Conventionally defined inflation is low now, so the Fed under any likely Chair would continue its program of monetary stimulus. Perhaps Yellen is personally inclined to continue it longer than might some other candidates. But all possible Fed chiefs’ would face the same pressures to “do something” to enhance job growth, even if its policy tools are not effective.

The prolonged period of low interest rates has made the Fed the enabler of the federal government’s fiscal deficits. Low interest rates have kept down the government’s borrowing costs, at least compared to what they would have been under “normal” interest rates of 3-4 percent.

Congress and the president have been spared a fiscal crisis, and thus repeatedly punted on fiscal reform. They are likely to continue doing so until rising interest rates precipitate a crisis. How long that can be postponed remains an open question.

The Contempt’s the Thing

There’s been much ink spilled the past few days over U.S. Secretary of Education Arne Duncan’s defense of the Common Core, delivered as an obnoxious attack on white, suburban women. Proclaimed Duncan to a meeting of the Council of Chief State School Officers (one of the Core’s progenitors):

It’s fascinating to me that some of the pushback is coming from, sort of, white suburban moms who – all of a sudden – their child isn’t as brilliant as they thought they were and their school isn’t quite as good as they thought they were, and that’s pretty scary.

Much of the uproar over Duncan’s attack has been over his injecting race and sex into the Common Core debate, and that certainly was unnecessary. But much more concerning to me – and indicative of the fundamental problem with federally driven national standardization – is the clear message sent by Duncan’s denunciation of Jane Suburbia: average Americans are either too dull or too blinkered to do what’s best for their kids. The masses need their betters in government – politicians, bureaucrats – to control their lives.

Alas, this has been a subtext of almost the entire defense of the Core. Every time supporters decide to smear opponents primarily as “misinformed” or “conspiracy theorists,” they imply that people who are fighting for control of what their children will learn are either too ignorant, or too goofy, to matter.

Of course, there are some opponents who don’t get all the facts right about the Common Core, but supporters ignore that many of these people are just finding out about the Core. Unlike major Core supporters, many opponents – often parents and plain ol’ concerned citizens – haven’t been working on the Core for years. And even when opponents use such regretably over-the-top rhetoric as calling the Common Core “Commie Core,” they are ultimately making a legitimate point: the federally driven Core is intended to make the learning outcomes of all public schools the same – “common” is in the name, for crying out loud! – and in so doing, nationalize learning. At the very least, that’s not a move in the libertarian direction.

TSA, Terrorism, and Civil Liberties

My new study on the Transportation Security Administration mainly focuses on the agency’s poor management and performance. The TSA has a near monopoly on security screening at U.S. airports, and monopoly organizations usually end up being bloated, inefficient, and providing low-quality services. 

The study proposes contracting out or “privatizing” airport screening, which is the structure of aviation security used successfully in Canada and many European countries.

I briefly discuss some of the civil liberties problems surrounding TSA. Note that Cato’s Jim Harper also addresses those issues in his work, as does Robert Poole of Reason Foundation. I noticed this recent blog post by Poole that nicely summarizes some of the realities of TSA, terrorism, and civil liberties:

A couple of years ago Jonathan Corbett, a tech entrepreneur from Miami, posted videos online showing him successfully passing through TSA airport body scanners with a metal box concealed under his clothing, seeking to demonstrate that the scanners are an ineffective replacement for walk-through metal detectors for primary screening. In 2010 he filed a lawsuit contending that body-scanning and pat-downs are both unreasonable searches that violate the Fourth Amendment.

As part of the discovery process, TSA provided Corbett with 4,000 pages of documents, many of them classified. He was allowed to produce two versions of his brief, one containing extracts of classified material, and available only to the court, and a heavily redacted version which could be made public. But as several news sites reported last month, a clerk in the US Court of Appeals (11th District) mistakenly posted the classified version online, and it was quickly noticed and reproduced on various websites. Although the court issued a gag order prohibiting Corbett from talking about the classified material, there was no way to stop others from doing so.

Thank Inventors and Innovators for a Better Life

Hans Riegel recently died at age 90. He changed the world for the better. He brought us the treat known as gummi bears. 

Politicians routinely crusade against wealth and inequality, but that occurs naturally when people create products and offer services benefiting the rest of us.   

Today people live on their cell phones. Once we didn’t even have telephones. Thank Alexander Graham Bell, born in Edinburgh, Scotland. 

The internal combustion engine auto came from Karl Benz. He was a design engineer who in 1886 won a patent for a “motor car.” 

In 1903, Clarence Crane created the hard fruit candy known as Life Savers. 

Helen Greiner, a fan of Star Wars’ R2D2, came up with the Roomba vacuum cleaner robot in 2002. 

John Mauchly and John Eckert created the first computer in 1946—the Electronic Integrator and Computer, or ENIAC. 

Thomas Edison gave us working light bulbs in 1879. Joseph Swan might have beaten Edison, but the latter bought Swan’s patent. 

The 3-D printer was created in 1983 by Chuck Hall. His first creation: a tea cup. 

DOJ Still Fighting School Choice in Louisiana

Last week I noted that it was “long past time for the U.S. Department of Justice to drop its embarrassing lawsuit which would keep black kids in failing schools.” The Louisiana Department of Education released a study that completely undermined the DOJ’s case against the state’s school voucher program, showing that the program increased racial integration in most of the schools under federal desegregation orders and had a miniscule impact in the remainder.

Today, Michael Warren of the Weekly Standard reports that the DOJ has dropped part of its fight against school choice in Louisiana:

The Obama administration’s Justice Department has dropped a lawsuit aiming to stop a school voucher program in the state of Louisiana. A ruling Friday by a United States district court judge revealed that the federal government has “abandoned” its pursuit of an injunction against the Louisiana Scholarship Program, a state-funded voucher program designed to give students in failing public schools the opportunity to attend better performing public or private schools. 

“We are pleased that the Obama Administration has given up its attempt to end the Louisiana Scholarship Program with this absurd lawsuit,” said Louisiana governor Bobby Jindal, a Republican, in a statement. “It is great the Department of Justice has realized, at least for the time being, it has no authority to end equal opportunity of education for Louisiana children.”

The move may have resulted from the bad press or a sudden acceptance of common sense, but more likely it was a simply legal maneuver to prevent the Black Alliance for Educational Options and the Goldwater Institute, representing parents of voucher recipients, from intervening in the lawsuit as defendants. As Warren reports:

On Friday, Judge Ivan Lemelle of the U.S. district court of the Eastern District of Louisiana ruled the parents could not intervene in the case because the feds are “no longer seeking injunctive relief at this time.” Lemelle explained that in the intervening months since the Justice Department filed suit, it had made clear both in a supplemental filing and in its opposition to the parent group’s motion to intervene that it was not seeking in its suit to end the voucher program or take away vouchers from students.

Lemelle continued: “The Court reads these two statements as the United States abandoning its previous request that the Court ‘permanently enjoin the State from issuing any future voucher awards to students unless and until it obtains authorization from the federal court overseeing the applicable desegregation case.’”

Lemelle will hold an oral hearing on Friday, November 22, during which Justice will make its case for the federal review process of the voucher program. In his statement on Friday’s ruling, Jindal criticized the federal government’s efforts.

“The centerpiece of the Department of Justice’s ‘process’ is a requirement that the state may not tell parents, for 45 days, that their child has been awarded a scholarship while the department decides whether to object to the scholarship award. The obvious purpose of this gag order would be to prevent parents from learning that the Department of Justice might try to take their child’s scholarship away if it decides that the child is the wrong race,” said Jindal. “The updated Department of Justice request reeks of federal government intrusion that would put a tremendous burden on the state, along with parents and teachers who want to participate in school choice.”

In other words, the DOJ is still seeking the legal authority to prevent low-income kids from escaping failing public schools if the feds say they have the wrong skin color.

A Conspiracy against Obamacare

A Conspiracy Against Obamacare coverLast week, A Conspiracy Against Obamacare: The Volokh Conspiracy and the Health Care Case was released, of which I am proud to be the editor. The book compiles the discussions and debates about the Affordable Care Act that occurred on the legal blog the Volokh Conspiracy, supplemented with new material. The posts are stitched together into a narrative structure. As a result, you can see the constitutional arguments against the Affordable Care Act develop in real time, from before the law was passed all the way to the Supreme Court. 

The book documents a bellwether moment in the history of legal academia: A legal academic blog influencing major Supreme Court litigation. And not just major Supreme Court litigation, but a case that went from a much derided challenge to the biggest and most watched case in decades. As former Solicitor General Paul D. Clement, who expertly argued the case before the Court, kindly wrote in the foreword, “The Constitution had its Federalist Papers, and the challenge to the Affordable Care Act had the Volokh Conspiracy.”

The contributors are Randy E. Barnett, Jonathan H. Adler, David E. Bernstein, Orin S. Kerr, David B. Kopel, and Ilya Somin, most of whom are closely associated with Cato in one way or another.

In the introduction, I discuss the constitutional arguments against the law in a more abstract way, as well as describe how the law is destined to fail due to poor design. We are seeing the beginning of those failures now, but I fear we ain’t seen nothin’ yet.

It was not much commented on at the time–the administration and the law’s supporters were too busy spiking the ball–but the Supreme Court’s decision will speed up the law’s inevitable failures. As I describe in the introduction:  

Due to the chief justice’s unpredictable opinion, we are now likely stuck with a law that I fear will seriously damage the health of Americans. What’s more, attempts to further centralize power will not stop at the individual mandate. When the law fails, as I predict it will, it will be said that the federal government lacked enough power to make it work. The chief justice’s opinion gives people a real choice whether to comply with the requirement to purchase insurance or pay a “tax.” Many people will not, and as the price of insurance goes up, more and more people will choose to remain uninsured. This will certainly be called a “loophole.” Similarly, the Court also gave states a choice about whether to comply with the Affordable Care Act’s Medicaid expansion. Another “loophole.” Finally, the states that don’t create health care exchanges will also throw wrenches in the law’s overall scheme. “Loopholes” all around. Having freedom of choice in deeply personal health care decisions, however, is not a loophole.

When the time comes to revisit the Affordable Care Act, those choices by free, sovereign entities (citizens and states) will be blamed for the law’s dysfunctions. To paraphrase philosopher Robert Nozick, liberty disrupts patterns. Free choice inevitably upsets the carefully crafted plans of Washington.

As a solution to the law’s problems, more power will be proposed. A few voices, such as many who write for the Volokh Conspiracy and those of us at the Cato Institute, will strenuously argue that the problem is not a lack of power but a lack of freedom. I am not optimistic, however, that very many entrenched bureaucrats and politicians will locate the problem in the mirror rather than in the freedoms of the American people.

If the Affordable Care Act keeps going south at this rate, we may need to prepare to have that debate sooner than we expected.