Archives: 04/2015

Maine’s Recommitment to Work Requirements

Last week, the Associated Press reported that more than 9,000 food stamp recipients in Maine have been removed from the program because they failed to comply with the program’s work requirements. These requirements themselves are largely nothing new, but in the years since the recession, almost every state received a waiver exempting them from these provisions. By allowing the waiver to lapse, Maine will again enforce the requirement that able-bodied adults without dependents participate in some form of work activity. These rules only apply to a small fraction of beneficiaries, just 10 percent of Maine’s beneficiaries in 2013. A spokesman for the Maine Department of Health and Human Services revealed that the number of SNAP beneficiaries subject to the reinstated requirements has fallen from roughly 12,000 to 2,680. This is a steep reduction, but relatively small compared to the 250,000 people in the Supplemental Nutrition Assistance Program (SNAP) when the rule change went into effect.

Even before the recession, the percentage of Maine households in the program surged from 9.6 percent in 2002 to 12.3 percent in 2007. The recession caused the beneficiary rolls to swell even further, and they have continued to grow in the years since, in part due to the waiver. In 2013, 18 percent of Maine households participated in SNAP, third highest in the country. As the figure shows, since October 2010, Maine’s unemployment rate has fallen significantly, but the number of SNAP recipients remains elevated. Since the enforcement of the new rules began, these two measures have been more highly correlated.

Maine Unemployment Rate vs. SNAP Beneficiaries

 

Sources: Federal Reserve Bank of St. Louis, “Federal Reserve Economic Data,” MEUR_NBD20100901, BRME23M647NCEN; Office of Family Independence, “Geographic Distribution of Programs and Benefits,” Maine Department of Health and Human Services, June 2013-February 2015.

Innovating Within an Overregulated Alcohol Landscape: A #CatoDigital Discussion

April is Alcohol Awareness Month. What better time to take a close look at one of our nation’s most heavily regulated industries and the inventive ways entrepreneurs are innovating within this realm?

The ratification of the 21st Amendment may have officially ended this nation’s failed experiment with alcohol Prohibition, but the policy hangover has had lingering effects. From dry counties to bans on Sunday sales, the sale of alcohol is severely restricted in a confusing patchwork of local, state, and federal regulations. Homebrewing was not legal in all 50 states until 2013 (and homebrewers still cannot legally sell their product). Eighteen states maintain a state monopoly over the wholesaling or retailing of some or all categories of alcoholic beverages. But, even in this stifling economy, intrepid businesses are finding new ways to serve thirsty consumers.  

One real-world example of this is Klink, formerly known as DrinkDrivers, a rapidly growing start-up with a strong foothold in the nation’s capital. The app-based alcohol delivery company relies upon the mechanisms of the sharing economy—which has faced its own share of difficulties from overzealous regulators—to navigate the treacherous legal landscape of the American alcohol industry.

The concept behind Klink is a simple one: modern consumers want the ease of on-demand goods and services, deliverable at the touch of a button, wherever they are. Yet, Klink is not an alcohol provider in the traditional sense.

Unlike many other businesses in the sharing economy, Klink is stringent in its adherence to the laws and regulations governing alcohol sales. When you place an order, the company does not itself process your payments or deliver your alcohol. Instead, Klink plays the role of middleman, partnering with licensed liquor retailers, providing an easy-to-use online platform to connect alcohol providers with customers and occasionally running localized marketing campaigns.

Tomorrow at noon, I’ll be moderating a live-streamed lunchtime discussion featuring my colleague Matthew Feeney, who is Cato’s leading expert on the sharing economy; David Ozgo, the Distilled Spirits Council of the United States (DISCUS)’s Senior Vice President of Economic & Strategic Analysis; and Klink’s Founder and CEO, Jeffrey Nadel.

We’ll be discussing the ways in which Klink is navigating the treacherous regulatory waters of both the sharing economy and the alcohol industry, the regulatory hurdles standing in their way, and what this means for the future of tech innovation and alcohol sales. The panel will be live-streamed, and at-home viewers are encouraged to participate in the Twitter discussion—and tweet their question—using #CatoDigital.

Indiana’s Religious Freedom Law Is Deja Vu All Over Again

This debate is so banal. Progressives shout “discrimination,” conservatives cry “liberty,” and it really all boils down to the difference between government and private action, which both sides misunderstand.

Progressives aren’t satisfied with state recognition of same-sex couples and want to bend the will of those private citizens who have religious objections to the only belief system that’s now allowed by MSNBC polite society. Conservatives are wrong to oppose the extension of state marriage licenses to same-sex couples – I’m against such licensing schemes, but states have no good reason to treat gay and straight people differently – and it’s that opposition that breeds distrust when they correctly argue that people should be free to live their lives according to their consciences.

As I said a year ago,

[The Indiana law] does nothing more than align state law with the federal Religious Freedom Restoration Act (which passed the House unanimously, the Senate 97-3, and was signed by President Clinton in 1993). That is, no government action can “substantially burden” religious exercise unless the government uses “the least restrictive means” to further a “compelling interest.” This doesn’t mean that people can “do whatever they want” – laws against murder would still trump religious human sacrifice – but it would prevent the government from forcing people to violate their religion if that can at all be avoided. Moreover, there’s no mention of sexual orientation (or any other class or category).

The prototypical scenario that [the law] is meant to prevent is the case of the New Mexico wedding photographer who was fined for declining to work a same-sex commitment ceremony. This photographer doesn’t refuse to provide services to gay clients, but felt that she couldn’t participate in the celebration of a gay wedding. There’s also the Oregon bakery that closed rather than having to provide wedding cakes for same-sex ceremonies. Why should these people be forced to engage in activity that violates their religious beliefs?

For that matter, gay photographers and bakers shouldn’t be forced to work religious celebrations, Jews shouldn’t be forced to work Nazi rallies, and environmentalists shouldn’t be forced to work job fairs in logging communities. This isn’t the Jim Crow South; there are plenty of wedding photographers – over 100 in Albuquerque – and bakeries who would be willing to do business regardless of sexual orientation, and no state is enforcing segregation laws. I bet plenty of [Indiana] businesses would and do see more customers if they advertised that they welcomed the LGBT community.

At the end of the day, that’s what this is about: tolerance and respect for other people’s beliefs. While governments have the duty to treat everyone equally under the law, private individuals should be able to make their own decisions on whom to do business with and how – on religious or any other grounds. Those who disagree can take their custom elsewhere and encourage others to do the same. 

I hate to repost exactly the same thing, but literally nothing has changed but the site of the overwraught protests.

Moreover, I don’t know why you’d want to have someone who can’t in good faith (literally) support your celebration be a vendor for that event. Actually, I do know: it’s the desire of some to change and narrow the rules of the game “such that private institutions are allowed to continue operating only as long as they follow a prescribed list of behaviors and mores.” (To quote something new, my recent recent National Affairs essay on “Hobby Lobby and the Future of Freedom.”) For more smart takes, see Josh Blackman and Jon Adler.

Oh, and apparently Arkansas is now joining the party too. This could become one of the big issues of the 2016 election – not same-sex marriage itself, mind you, but the brave new world of government mandates clashing with religious (among other) freedoms.