Topic: Cato Publications

Zimbabwe’s Decline

Zimbabwe, a country with one of the world’s least free economies led for decades by the authoritarian Robert Mugabe, has been growing rapidly in recent years. It has outperformed the group of six African countries dubbed the “Lion Kings” because of their high growth. In a Cato paper released today, Craig Richardson explains the factors behind Zimbabwe’s growth, including high commodity prices, and why its performance is unsustainable. 

On Saturday, Zimbabwe voted on a referendum on a proposed constitution. The results should be known later this week, but as Richardson wrote Friday in a Wall Street Journal Europe op-ed, if the constitution is approved as expected, it will enshrine “government land grabs as perfectly legal.” Recall that the country began a period of severe economic and political turmoil precisely when the government began seizing large commercial farms at the beginning of the last decade. Unfortunately, most signs point to further decline for Zimbabwe.

And the King of the Fiscal Squeeze Is…Bill Clinton?

When Congressman Paul Ryan takes the stage at CPAC Friday morning, he will, of course, tout his new budget as a solution to America’s spending problem. The 2014 Ryan plan does aim to balance the budget in 10 years. That said, it would leave government spending, as a percent of GDP, at a hefty 19% – as my colleague, Daniel J. Mitchell, points out in his recent blog.  

Proposals like the Ryan budget are all well and good, but they are ultimately just that – proposals. If Congressman Ryan really wants to get serious about cutting spending, he should look to the one U.S. President who has squeezed the federal budget, and squeezed hard.

So, who can Congressman Ryan look to for inspiration on how to actually cut spending? None other than President Bill Clinton.

How can this be? To even say such a thing verges on CPAC blasphemy. Well, as usual, the data don’t lie. Let’s see how Clinton stacks up against Presidents Barack Obama and George W. Bush. As the accompanying chart shows, Clinton was the king of the fiscal squeeze.

Yes, Bill Clinton cut government’s share of GDP by a whopping 3.9 percentage points over his eight years in office. But, what about President Ronald Reagan? Surely the great champion of small government took a bite out of spending during his two terms, right? Well, yes, he did. But let’s put Reagan and Clinton head to head – a little fiscal discipline show-down, if you will (see the accompanying chart).

And the winner is….Bill Clinton. While Reagan did lop off four-tenths of a percentage point of government spending, as a percent of GDP, it simply does not match up to the Clinton fiscal squeeze. When President Clinton took office in 1993, government expenditures accounted for 22.1% of GDP. At the end of his second term, President Clinton’s big squeeze left the size of government, as a percent of GDP, at 18.2%. Since 1952, no other president has even come close.

Some might argue that Clinton was the beneficiary of the so-called “peace dividend,” whereby the post-Cold-War military drawdown led to a reduction in defense expenditures. The problem with this explanation is that the majority of Clinton’s cuts came from non-defense expenditures (see the accompanying table).

Admittedly, Clinton did benefit from the peace dividend, but the defense drawdown simply doesn’t match up to the cuts in non-defense expenditures that we saw under Clinton. Of course, it should be noted that the driving force behind many of these non-defense cuts came from the other side of the aisle, under the leadership of Speaker Gingrich.

The jury is still out on whether Ryan (or Boehner) will prove to be a Gingrich – or Obama, a Clinton. But, at the end of the day, the presidential scoreboard is clear – Clinton is the king of the fiscal squeeze.

So, when Congressman Ryan rallies the troops at CPAC with a call for cutting government spending, perhaps the crowd ought to accompany a standing ovation for the Congressman with a chant of “Bring Back Bill!”

You can follow Prof. Hanke on Twitter at: @Steve_Hanke

The Moral Authority of the State

If everyone judged the state and its agents by the same moral standards that they used for ordinary people, then nearly all of us would be libertarians. Judged in this way, essentially all governments behave appallingly.

“Yes,” comes the standard reply, “but we don’t judge governments by the same standards. The state is different, you see.”

Of course, it’s only fair to ask why that might be the case. This month at Cato Unbound, philosopher Michael Huemer does just that, addressing several of the standard reasons why the state purportedly has license to behave very differently from the rest of us. He finds them all lacking in one way or another.

Huemer’s essay draws on his new book, The Problem of Political Authority, in which he addresses nearly all of the most common justifications for treating the state as a moral agent with legitimate powers beyond those of the rest of us. For those who usually shy away from philosophy, Huemer is an intuitionist—he doesn’t build abstract systems of thought, which may or may not be convincing or even comprehensible. He begins instead with common, widely shared intuitions, in the hope that nearly all of us, whether utilitarians, deontologists, virtue ethicists, agnostics, or otherwise, will find his conclusions compelling.

To discuss with him, we’ve recruited a panel of distinguished thinkers of varying persuasions: George Mason economics professor Bryan Caplan, libertarian scholar-activist Tom G. Palmer, and Binghamton University philosophy professor Nicole Hassoun.

As always, Cato Unbound readers are encouraged to take up our themes, and enter into the conversation on their own websites and blogs, or on other venues. We also welcome your letters. Send them to jkuznicki at cato dot org. Selections may be published at the editors’ option.

Whip Illegitimacy Now (WIN)!

You just know a David Brooks column featuring the refrain, “my dream Obama would…” is going to be exasperating. And it is: especially when he suggests that his “dream Obama” could and should:

… talk obsessively about family structure and social repair. Every week we get another statistic showing how social and income inequality is dividing the nation. …. while childhood obesity is falling among kids whose parents graduated from college, it is still rising among kids whose parents have a high school degree or less.

Because of his upbringing, President Obama is uniquely qualified to talk about family structures. Traditional values are an investment in the young, and he could do what he can to restitch the social fabric.

It’ll be tough to “restitch the social fabric” when you need at least one hand free to bend the arc of history, but no doubt President Obama believes he’s up to the task. Still, why does David Brooks think it would help to have the president “talk obsessively about family structure and social repair”?

Barack Obama has been talking obsessively about capital-‘h’ Hope for nearly a decade, and during his administration, as with his predecessor’s, many more Americans think the country’s on the “wrong track” than think it’s moving in the “right direction.” (.pdf).

The evidence that the presidential “bully pulpit” reliably sways the public’s policy preferences is weak enough, as Ezra Klein documents here. What evidence is there that presidential jawboning about family structures changes anyone’s behavior? Birth rates for unmarried women went down in the era of Monica Lewinsky and Gennifer Flowers, resuming their upward trend under family values president George W. Bush. Do people really make their choices about marriage and family under the influence of presidential rhetoric or with an eye toward the example he sets?

The campaign Brooks envisions would be about as effective as Gerald Ford’s little Whip Inflation Now (WIN) buttons. Maybe it’s time for a little less magical thinking about our presidents. 

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.

“We’re Going to Have to Come Up with Something.”

And that something is a national ID.

The quote is Senator Chuck Schumer’s (D-NY), speaking about immigration reform at Politico’s Playbook Breakfast. The national ID gloss is mine, based on the immutable logic of “internal enforcement.”

Senators Schumer and McCain (R-AZ) say that the “Gang of Eight” senators who are working up an immigration reform package are united on the idea of making it impossible for illegal immigrants to get work in the United States. The only way to do that is to put all working Americans—if you work, that means you—into a national ID system.

“People say, ‘National ID card,’” Senator Schumer says. They do because that is what he’s talking about.

Now, they haven’t gotten all the way through the logic of their plans. Senator Schumer talks about a “non-forgeable [Social Security] card,” but a Social Security card only proves that a certain name is linked to a certain number. If a system is going to prove that a given person is entitled to work in the United States, it must be an identity system. It must compare the identifiers of the person to the identifiers in the system, whether held on a card or in a database, so that it can assess their legal status, including natural-born citizenship.

This is why Senator Schumer also talks about biometrics. The system must biometrically identity everyone who works—you, me, and every working American you know. There is no way to do internal enforcement of immigration law without a biometric national identity system.

It looks as though E-Verify, an incipient national ID system, will be a part of most or all comprehensive immigration reform proposals. Ironically, immigration reform that aligns the law with our country’s economic need for labor would obviate the need for E-Verify and a national ID. 

There are lots of ways to become familiar with the national ID issues that have yet to bubble up in this early stage of the immigration reform debate. My 2006 book, Identity Crisis, is a decent primer on identity and national ID generally. I examined the direct line between internal enforcement of immigration law and a national ID in my 2008 paper: “Electronic Employment Eligibility Verification: Franz Kafka’s Solution to Illegal Immigration.” And my article in last year’s special Cato Journal on immigration reform was called: “Internal Enforcement, E-Verify, and the Road to a National ID.”

Changing the Electoral College Game

Article II of the United States Constitution states: “Each State shall appoint, in such Manner as the Legislature thereof may direct, a Number of Electors, equal to the whole Number of Senators and Representatives to which the State may be entitled in the Congress” to elect the president. The phrase “in such Manner” does not obviously restrict the way electors may be rewarded.

Even before the last election, some people had proposed changing the way states award electoral votes. The National Popular Vote effort, for example, proposed a compact in which states with a majority of the electoral votes agree to award their votes to the winner of the popular vote for president. Now other people, mostly Republicans, propose that states award each of their electoral votes to the winner of each congressional district in a state.

This proposal is highly partisan, but it is not outlandish. Two states, Nebraska and Maine, now award almost all of their electoral votes by congressional district. In each state, two of their electoral votes (the two they get because of equal state representation in the Senate) go the state-wide winner of the popular vote.

However, proponents of the “district proposal” have not suddenly been convinced of the merits of presidential elections in Maine and Nebraska. Rather, they are beguiled by the thought that Mitt Romney would have won in 2012 had electoral votes been awarded by congressional district.

Here we find the first problem with the proposal: it concerns the past not the future. Much like those liberal Democrats who wished to change the filibuster rule because Sen. McConnell (R-KY) frustrated the president’s desires on health care, some Republicans now wish to change electoral rules in response to the 2012 disaster.

It is unlikely that states governed by Democratic majorities in the legislature would adopt this proposal. Let’s assume they would, however, to think about what might happen.

The “district proposal” would increase the value of partisan redistricting since the presidency as well as the House would now depend on the composition of congressional districts.

The “district proposal” might change nothing. If the partisan majority in every state legislature has already maximized its share of congressional seats, nothing changes. I think that would be the case for most states controlled by the GOP.