Tag: federalism

Three Cheers for Switzerland as Voters Reject Class-Warfare Tax Hike in National Referendum

I’ve always had a soft spot for Switzerland. The nation’s decentralized structure shows the value of federalism, both as a means of limiting the size of government and as a way of promoting tranquility in a nation with several languages, religions, and ethnic groups. I also admire Switzerland’s valiant attempt to preserve financial privacy in a world dominated by greedy, high-tax governments.

I now have another reason to admire the Swiss. Voters yesterday overwhelmingly rejected a class-warfare proposal to impose higher tax rates on the income and wealth of rich residents. The Social Democrats did their best to make the hate-and-envy scheme palatable. Only the very richest taxpayers would have been affected. But Swiss voters, like voters in Washington state earlier this month, understood that giving politicians more money is never a solution for any problem.

Here’s an excerpt from Bloomberg’s report on the vote.

In a referendum today, 59 percent of voters turned down the proposal by the Social Democrats to enact minimum taxes on income and wealth. Residents would have paid taxes of at least 22 percent on annual income above 250,000 francs ($249,000), according to the proposed changes. Switzerland’s executive and parliamentary branches had rejected the proposal, saying it would interfere with the cantons’ tax-autonomy regulations. The changes would also damage the nation’s attractiveness, the government, led by President Doris Leuthard, said before the vote. The Alpine country’s reputation as a low-tax refuge has attracted bankers and entrepreneurs such as Ingvar Kamprad, the Swedish founder of Ikea AB furniture stores, and members of the Brenninkmeijer family, who owns retailer C&A Group.

It’s never wise to draw too many conclusions from one vote, but it certainly seems that voters usually reject higher taxes when they get a chance to cast votes. Even tax increases targeting a tiny minority of the population generally get rejected. The only exception that comes to mind is the unfortunate decision by Oregon voters earlier this year to raise tax rates.

Diane Ravitch Is Right on Republicans and NCLB

Writing in yesterday’s WSJ, education historian Diane Ravitch laments that Republicans have abandoned their earlier defense of federalism and limited government in education, embracing vast and expanding powers for Washington over the nation’s schools. In particular, she faults the No Child Left Behind act for demanding public school improvements that have not been forthcoming and for imposing “corrective” measures that will not correct the problem.

Though I depart from Ravitch on most education policy matters – and not just on conclusions but also methodology – she is right in both of the above observations. Over the past decade, many Republicans have championed new federal powers in education that have no basis in the U.S. Constitution, no plausible empirical justification, and no evidence of success. NCLB demands higher achievement without creating the market freedoms and incentives that would actually allow it – asking, in other words, for the impossible.

With the current resurgence of public interest in limited government, Republicans have an excellent opportunity to rekindle their commitment to the limited federal role in education laid out by the U.S. Constitution. Phasing out NCLB would be a good place to start.

Reform for Senate Elections?

People inside the Beltway seem to think that the only things worth being said and written are said and written in Washington. John David Dyche’s column today makes a good case for the quality of commentary outside the all-knowing capital.

While most everyone in DC is calling the stretch run of the horse race, Dyche steps back and wonders whether the Kentucky Senate race would have been better for citizens if the U.S. Constitution had not been changed to direct election of senators. He thinks it would be.

I am not so certain. As Dyche notes, James Madison thought the representative or indirect aspects of American constitutional democracy would improve public choice. As times has passed, I wonder more and more about the quality of people drawn to all legislatures, including state bodies. Madison thought indirect election wold “refine and enlarge the public views by passing them through the medium of a chosen body of citizens, whose wisdom may best discern the true interest of their country and whose patriotism and love of justice will be least likely to sacrifice it to temporary or partial considerations.” Should we still rely on the wisdom of that medium? And yet, what is the alternative? (Todd Zywicki has an informative article on the origins and demise of indirect election of senators).

Dyche works as an attorney in Louisville, Kentucky, and has written a nice biography of Mitch McConnell. His column is worth a regular read, especially if Rand Paul comes to Washington as a U.S. Senator. Dyche would be a good guide to how Paul’s libertarian tendencies are playing out politically back home.

That Conway Ad and Social Liberalism

The infamous Conway attack on Rand Paul may be found here. Most people have focused on religion and politics in talking about the ad. I want to examine a part that has been overlooked.

We often hear that contemporary liberalism comprises a big state role in economic regulation combined with a small state regarding social and civil liberties. Maybe not.

Look at the disclaimer at the beginning of the ad. Who is standing behind Jack Conway? Those two gentlemen would police officers, probably Kentucky state police. Why are they there? After all, Conway could have put his loving wife and dear children in the background. But he choose police officers. Conway is saying: “I stand with the forces of order.” Not a very socially liberal message.

Why are the police willing to be in Conway’s ad? After all, the forces of order usually endorse the Republican candidate. Not this time. The Fraternal Order of Police in Kentucky endorsed Jack Conway. Why? Rand Paul suggested the drug war in Kentucky might be paid for in Kentucky. This had two effects. First, it cast doubt on the holiness of the anti-drug crusade. By putting the police officers behind him, Jack Conway is saying: “I will fight the drug war no matter what.” Not good for social liberalism or civil liberties.

Of course, the police have a material interest in the drug war in Kentucky. They believed that Dr. Paul’s call for federalism would mean lower salaries and less resources for the drug war in Kentucky. Conway is saying here: no budget cuts for my friends, the forces of order.  Thus does the drug war bring the Kentucky State Police and the Daily Kos into a political alliance.

Like most politicians, Jack Conway is doing whatever is necessary to win a senate seat. He could end up as the pivotal vote for a Democratic Senate majority, at least in partisan matters.

If he votes as he ran, Conway will be a reliable vote for the policy status quo on the drug war, against civil and social liberties, and for a politics that always and everywhere covets victory “by any means necessary.” He should fit in well in Washington, especially with the more authoritarian parts of the GOP.

Partnership, ObamaCare-Style: Jump, or Be Pushed

Financial Times writes:

The federal government will step in to ensure that the Obama administration’s health care reforms are implemented in every state, Kathleen Sebelius, the health secretary, said, amid growing resistance to the changes in some parts of the US and an inability to act in others.

The article quotes Health and Human Services Secretary Kathleen Sebelius:

The way the bill is written, it really is a state-based programme with the federal government providing the back-up.  So if a state opts not to set up a risk pool, we do it here at the department. If the state opts not to regulate their insurance market, we do it…

It is not a federal takeover, it’s really a partnership.

Yes, a partnership not unlike that between the Soviet Union and, say, Czechoslovakia.

The Obama administration has good reason to emphasize its conception of this “partnership:”

[S]ome big states, including California and Florida, said they did not have the legal authority to enforce the new consumer protection standards, while others face such severe budget crises that they will struggle to pay for provisions, such as the expanded Medicaid services for lower-income groups, required under the law….

Separately, more than 20 states are challenging a mandate that requires almost all Americans to have some form of insurance by 2014 as unconstitutional. A judge in Virginia has said a challenge brought by the state’s attorney-general can proceed, while Arizona, Florida and Oklahoma will soon follow in Missouri’s footsteps by holding yes-or-no referendums on the mandate….

“Federal/state relations is one of the biggest challenges to implementing healthcare reform,” said Diane Rowland, executive vice-president of the Kaiser Family Foundation, a non-partisan health policy group. “Many of the states are facing fiscal crises and they have real capacity issues.”

Sebelius is undeterred:

The legal challenges will work their way through…. It doesn’t slow anything down. This is the law of the land.

Maybe, but then again, maybe not.

George Will Has Questions for Elena Kagan

George Will has some excellent questions for Supreme Court nominee Elena Kagan. 

Here’s an excerpt:

The government having decided that Chrysler’s survival is an urgent national necessity, could it decide that Cash for Clunkers is too indirect a subsidy and instead mandate that people buy Chrysler products?

If Congress concludes that ignorance has a substantial impact on interstate commerce, can it constitutionally require students to do three hours of homework nightly? If not, why not?

Can you name a human endeavor that Congress cannot regulate on the pretense that the endeavor affects interstate commerce? If courts reflexively defer to that congressional pretense, in what sense do we have limited government?

In Federalist 45, James Madison said: “The powers delegated by the proposed Constitution to the federal government are few and defined. Those which are to remain in the state governments are numerous and indefinite.” What did the Father of the Constitution not understand about the Constitution? Are you a Madisonian? Does the doctrine of enumerated powers impose any limits on the federal government? Can you cite some things that, because of that doctrine, the federal government has no constitutional power to do?

It is unfortunate that Will’s column did not make the hard copy of today’s Washington Post.  (The column is dated today, but it’ll likely appear in his regular Sunday space.) Senators on the Judiciary Committee need to read this stuff.

Why Do Libertarians Care about Federalism?

That’s the question NYU law professor Rick Hills asks over at PrawfsBlaws:

So why do American libertarians think that federalism is consistent with their commitment to individual liberty? Why not, instead, support a strong national government that can suppress subnational trade wars and protect a robust set of national liberties? What’s the payoff, in terms of individual liberty, from protecting subnational jurisdictions’ exclusive jurisdiction over certain topics?

In other words, if government is bad, why do we want a multiplicity of governments – federal, state, local – all presumably restricting individual liberty in some way?

Well, with all due respect to Prof. Hills – who also graciously commended Cato’s brief in Comstock, in which we argue that that Congress cannot enact a civil commitment statute for sexual predators because there is no such enumerated power and it cannot be inferred from the Necessary & Proper Clause – his analysis erroneously assumes that libertarians (he specifically mentions Cato, our senior fellow Randy Barnett, and our adjunct scholar Ilya Somin) are results-oriented in our approach to constitutional interpretation.  And we shouldn’t pursue federalism, he says, because it’s against our interests.

Both of these premises are flawed.  I won’t go into much detail because Randy and (the other) Ilya have already provided reactions at the Volokh Conspiracy here and here, with which I agree.  First , we like federalism because that’s the system the Constitution set up and luckily, the Constitution is, for the most part, a libertarian document.  Second, the Framers set up the Constitution that way because the different levels of government would exist not to multiply power-hungry bureaucrats’ opportunities for mischief but precisely to disallow dangerous aggregations of power.  So from the get-go there was no possibility of federal tyranny and, after the Fourteenth Amendment empowered Congress and federal courts to protect individual rights against state infringement, there was to be no state tyranny either.

And so, much as we like the strict limitations on Congress’s power – the express enumerations of Article I, section 8, the Commerce Clause, etc. – we also like the Due Process, Equal Protection, and Privileges or Immunities Clauses of the Fourteenth Amendment.  There is thus no conflict between federalism as a structural constitutional provision that promotes liberty and other, “anti-federalist” provisions that also promote liberty.  In practice that means there is no conflict between arguing that Obamacare exceeds the federal government’s authority while asking the Supreme Court to strike down Chicago’s handgun ban.  The original meaning of the relevant constitutional provisions support both arguments – and both arguments enhance liberty!

It really is a remarkable document, this Constitution.  Too bad its proper understanding has been lost

For related thoughts on this fascinating debate, Randy proposes a constitutional amendment that might get us back to the federalism we once knew while (the other) Ilya dispels another of Prof. Hills’s minor premises, that European libertarians diverge from Americans on the issue of federalism.