Topic: General

Beware the Data, II

By
Neal McCluskey

A couple of months ago I warned about the dangers of having government gather and publish growing reams of information in the name of making education better. Sure, it sounds great – help people get as informed as possible! – but the dangers are legion. You can read about several such pitfalls in that old post. You can also get a sense of the great wealth of data already out there in this op-ed. What I haven’t discussed – and what might concern many Americans more than anything else – is the threat that massive data collection poses to our privacy.

Articles over the last week or so have started to draw significant attention to the growing education-information complex and its connection to long-standing efforts – especially federal – to accumulate information on Americans from birth to boardroom. Gaining particular traction has been a story about how student data collected in New York could be sold to companies or other entities outside of school districts. Even more concerning is a story by Joy Pullmann in the Orange County Register about lots of data collection and mining that is either already happening or under consideration nationwide.

What’s especially troubling to some people, including Pullmann, is that not only is there ever-growing centralization of curricula such as the federally backed Common Core, as well as centralized testing of knowledge, but there are also moves to assess students’ “affect” that could include wiring them to “facial expression” cameras and “skin conductance sensors.” Contemplating such things, it’s hard not to conjure up images of A Clockwork Orange.

When you read the federal report that proposes using “affective computing methods” such as skin sensors, it doesn’t appear that the authors have nefarious, big-brother intentions. The object of the report is to examine how students’ “grit” and perseverance can be improved, and that is a reasonable goal. Similarly, furnishing information about the academic status of incoming freshmen at a college, the amount they learn while in school, and how well they fare after graduation, is driven by good intentions.

But we must never feel content with good intentions. We must care primarily about the effects of the policies stemming from our golden goals, and as I’ve written previously, there are likely big, negative, immediate effects that would go with empowering more government data collection. There are also potentially even worse long-term consequences, including that government would begin to try to adjust students’ feelings and attitudes if doing so might produce better test scores or some other, politically determined, outcome. Indeed, such affect-engineering arguably already takes place with huge increases in ADD and ADHD diagnoses that lead to personality-altering drug-taking.

It’s easy – and almost always innocent – to say that we need more information so that we can make things work better. But with that comes very big potential dangers we must never ignore.

Cross-posted at seethruedu.com

Topics: 
Education and Child Policy, General, Telecom, Internet & Information Policy

Deadline Extended for Legal Studies Institute’s Summer Program

By
Ilya Shapiro

The Fund for American Studies has long done excellent work educating students on the principles of individual liberty and free-market public policy.  Many Cato scholars and interns have been involved with its programming over the years, including Roger Pilon and Randy Barnett in the legal field.  I now have the privilege of serving on the Board of Visitors of TFAS’s Legal Studies Institute (along with Randy and others who are familiar to those who follow Cato’s work), and heartily recommend its summer program for law students looking for a DC experience that includes an internship, class credit, mentoring, high-level briefings and panels, and career development.  The application deadline has now been extended to April 3.  Here are the details:

LEGAL STUDIES INSTITUTE                                     

May 23 – August 2, 2013                                                                                             

Washington, D.C.                                                                             

PROGRAM COMPONENTS

  • Legal Internship: Participants will be placed in a 9-week summer legal internship where they will work full-time and gain substantive experience in the legal profession. Internship sites include law firms, courts, public interest organizations and the legal departments of trade associations, corporations and government agencies.
  • Briefings and Activities: Participants will attend private briefings at institutions of the judicial, legislative and executive branches and will meet with prominent judges, lawyers and judicial scholars. Previous guest speakers have included; Supreme Court Justice Antonin Scalia, Former Attorney General Michael Mukasey, U.S. Court of Appeals, Ninth Circuit Chief Judge Alex Kozinski and D.C. Federal Court of Appeals Judge Douglas Ginsburg among others.
  • Career Development Activities: Workshops will be held to help prepare participants for success in their law careers, and planned networking events will facilitate professional interaction. 
  • Attorney Mentor Program: Each participant will be matched with an experienced lawyer who will serve as a professional mentor during and after the program. 
  • Constitutional Law Course for Credit: You will be enrolled in a constitutional law course titled “Originalism and the Federalist Papers.” Classes will be held at Georgetown University Law Center. Students will receive credit from Ohio Northern University Pettit School of Law, or for an additional fee from Georgetown University Law Center. The course will be taught by Federalist Society lecturers, Professor John Baker, visiting fellow at Oriel College, University of Oxford and Visiting Professor at Georgetown University. Professor Randy Barnett, the Camack Waterhouse Professor of Legal Theory at Georgetown University Law Center and Professor Roger Pilon of the Cato Institute will also lecture. 
  • Housing: Students will live in fully-furnished apartments in downtown Washington, DC and are matched with other Institute participants. The apartments provide easy access to the DC metro transportation system. 
  • Scholarships: 75% of students receive scholarship awards based on financial need and merit.

APPLICATION INSTRUCTIONS

Applications will be accepted until the extended deadline of April 3, but applicants are encouraged to apply as early as possible.  Visit www.DCinternships.org/LSI for more details and to begin an application. Questions may be directed to Jennifer Fantin, LSI recruitment and admissions assistant at admissions [at] tfas [dot] org  or 202.986.0384.

Topics: 
General, Law and Civil Liberties

The Ryan Budget: Is Returning to Clinton-Era Levels of Fiscal Restraint Really Asking too Much?

By
Daniel J. Mitchell

It can be very frustrating to work at the Cato Institute and fight for small government.

Consider what’s happened the past couple of days.

Congressman Paul Ryan introduces a budget and I dig through the numbers with a sense of disappointment because government spending will grow by an average of 3.4 percent annually, much faster than needed to keep pace with inflation.

But I don’t even want government to grow as fast as inflation. I want to reduce the size and scope of the federal government.

I want to shut down useless and counterproductive parts of Leviathan, including the Department of Housing and Urban Development, the Department of Education, the Department of Energy, the Department of Transportation, the Department of Agriculture, etc, etc…

I want to restore limited and constitutional government, which we had for much of our nation’s history, with the burden of federal spending consuming only about 3 percent of economic output.

So I look at the Ryan budget in the same way I look at sequestration – as a very modest step to curtail the growth of government. Sort of a rear-guard action to stem the bleeding and stabilize the patient.

But, to be colloquial, it sure ain’t libertarian Nirvana (though, to be fair, the reforms to Medicare and Medicaid are admirable and stem in part from the work of Cato’s healthcare experts).

But my frustration doesn’t exist merely because the Ryan budget is just a small step.

I also have to deal with the surreal experience of reading critics who assert that the Ryan budget is a cut-to-the-bone, harsh, draconian, dog-eat-dog, laissez-faire fiscal roadmap.

If only!

To get an idea of why this rhetoric is so over-the-top hysterical, here’s a chart showing how fast government spending is supposed to grow under the Ryan budget, compared to how fast it grew during the Clinton years and how fast it has been growing during the Bush-Obama years.

Ryan Clinton vs Bush Obama

I vaguely remember taking the SAT test in high school and dealing with questions entitled, “One of these things is not like the others.”

Well, I would have received a perfect score if asked to identify the outlier on this chart.

Bush and Obama have been irresponsible big spenders, while Clinton was comparatively frugal.

And all Paul Ryan is proposing is that we emulate the policy of the Clinton years.

Now ask yourself whether the economy was more robust during the Clinton years or the Bush-Obama years and think about what that implies for what we should do today about the federal budget.

At the very least, we should be copying what those “radical” Canadians and other have done, which is to impose some genuine restraint of government spending.

The Swiss debt brake, which is really a spending cap, might be a good place to start.

Topics: 
General, Government and Politics, Tax and Budget Policy

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

By
Steve H. Hanke

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

Topics: 
Cato Publications, General, Government and Politics, Social Security, Tax and Budget Policy

Senator Patty Murray Is Right…and Completely Wrong…about the 1990s

By
Daniel J. Mitchell

I wrote about the Ryan budget two days ago, praising it for complying with Mitchell’s Golden Rule and reforming Medicare and Medicaid.

But I believe in being honest and nonpartisan, so I also groused that it wasn’t as good as the 2011 and 2012 versions.

Now it’s time to give the same neutral and dispassionate treatment to the budget proposed by Patty Murray, the Washington Democrat who chairs the Senate Budget Committee.

But I’m going to focus on a theme rather than numbers.

One part of her budget got me particularly excited. Her Committee’s “Foundation for Growth” blueprint makes a very strong assertion about the fiscal and economic history of the Clinton years.

The work done in the 1990s helped grow the economy, create jobs, balance the budget, and put our government on track to eliminate the national debt.

As elaborated in this passage, the 42nd President delivered very good results.

President Bill Clinton entered office in 1993 at a time when the country was facing serious deficit and debt problems. The year before, the federal government was taking in revenue equal 17.5 percent of GDP, but spending was 22.1 percent of the economy—a deficit of 4.7 percent. …The unemployment rate went from 7 percent at the beginning of 1993 to 3.9 percent at the end of 2000. Between 1993 and 2001, our economy gained more than 22 million jobs and experienced the longest economic expansion in our history.

And the Senate Democrats even identified one of the key reasons why economic and fiscal policy was so successful during the 1990s.

…federal spending dropped from 22.1 percent of GDP to 18.2 percent of GDP.

I fully agree with every word reprinted above. That’s the good news.

So what, then, is the bad news?

Well, Senator Murray may have reached the right conclusion, but she was wildly wrong in her analysis. For all intents and purposes, she claims that the 1993 tax hike produced most of the good results.

President Clinton’s 1993 tax deal…brought in new revenue from the wealthiest Americans and…our country created 22 million new jobs and achieved a balanced budget. President Clinton’s tax policies were not the only driver of economic growth, but our leaders’ ability to agree on a fiscally sustainable and economically sound path provided valuable certainty for American families and businesses.

First, let’s dispense with the myth that the 1993 tax hike balanced the budget. I obtained the fiscal forecasts that were produced by both the Congressional Budget Office and the Office of Management and Budget in early 1995 because I wanted to see whether a balanced budget was predicted.

As you can see in the chart, both of those forecasts showed perpetual deficits of about $200 billion. And these forecasts were made nearly 18 months after the Clinton tax hike was implemented.

So if even the White House’s own forecast from OMB didn’t foresee a balanced budget, what caused the actual fiscal situation to be much better than the estimates?

The simple answer is that spending was restrained. You can give credit to Bill Clinton. You can give credit to the GOP Congress that took power in early 1995. You can give the credit to both.

But regardless of who gets the credit, the period of spending restraint that began at that time was the change that produced a budget surplus, not the tax hike that was imposed 18 months earlier and which was associated with perpetual red ink.

But spending restraint tells only part of the story. With the exception of the 1993 tax hike, the Clinton years were a period of shrinking government and free market reform.

Take a look at my homemade bar chart to compare the good policies of the 1990s with the bad policies. It’s not even close.

You may be thinking that my comparison is completely unscientific, and you’re right. I probably overlooked some good policies and some bad policies.

And my assumptions about weighting are very simplistic. Everything is equally important, with a big exception in that I made the government spending variable three times as important as everything else.

Why? Well, I think reducing the burden of government spending during the Clinton years was a major achievement.

But maybe we shouldn’t rely on my gut instincts. So let’s set aside my created-at-the-spur-of-the-moment bar chart and look at something that is scientific.

This chart is taken directly from Economic Freedom of the World, which uses dozens of variables to measure the overall burden of government.

As you can see, the United States score improved significantly during the Clinton years, showing that economic freedom was expanding and the size and scope of government was shrinking.

In other words, Patty Murray is correct. She is absolutely right to claim that Bill Clinton’s policies “helped grow the economy, create jobs, balance the budget.”

Now she needs to realize that those policies were small government and free markets.

Topics: 
General, Government and Politics, Tax and Budget Policy

Making Sense of Drug Violence in Mexico with Big Data, New Media, and Technology

By
Juan Carlos Hidalgo

Yesterday we hosted a very interesting event with Google Ideas about the use of new media and technology information in Mexico’s war on drugs. You can watch the whole thing in the video below.

Unfortunately, one of the biggest casualties from the bloodshed that besets Mexico is freedom of the press. Drug cartels have targeted traditional media outlets such as TV stations and newspapers for their coverage of the violence. Mexico is now the most dangerous country to be a journalist. However, a blackout of information about the extent of violence has been avoided because of activity on Facebook pages, blogs, Twitter accounts, and YouTube channels.

Our event highlighted the work of two Mexican researchers on this topic. Andrés Monroy-Hernández from Microsoft Research presented the findings of his paper “The New War Correspondents: The Rise of Civic Media Curation in Urban Warfare” which shows how Twitter has replaced traditional media in several Mexican cities as the primary source of information about drug violence. Also, we had Javier Osorio, a Ph.D. candidate from Notre Dame University, who has built original software that tracks the patterns of drug violence in Mexico using computerized textual annotation and geospatial analysis.

Our third panelist was Karla Zabludovsky, a reporter from the New York Times’ Mexico City Bureau, who talked about the increasing dangers faced by journalists in Mexico and the challenges that new media represent in covering the war on drugs in that country.

Even though Enrique Peña Nieto, Mexico’s new president, has focused the narrative of his presidency on economic reform, the war on drugs continues to wreak havoc in Mexico. Just in the first two months of the year over 2,000 people have been killed by organized crime. 

At the Cato Institute we closely keep track of developments in Mexico and we have published plenty of material on the issue, including:

Watch the full event:

Understanding Mexico’s Epidemic of Violence

And for those who speak the language of Cervantes, here’s a ten minute interview that Karla Zabludovsky and I did on CNN en Español about the Cato event.

Topics: 
Foreign Policy and National Security, General, International Economics and Development, Law and Civil Liberties, Telecom, Internet & Information Policy

Everything You Need to Know About the Ryan Budget

By
Daniel J. Mitchell

Sigh. Even when they’re sort of doing the right thing, Republicans are incapable of using the right argument.

Rep. Paul Ryan (R-WI), chairman of the House Budget Committee, has unveiled his proposed budget and he and other Republicans are bragging that the plan will balance the budget in 10 years.

That’s all fine and well, but good fiscal policy is achieved by reducing the burden of government spending, and that means restraining the budget so that federal outlays grow slower than the private sector.

It’s good to balance the budget, of course, but that should be a secondary goal.

Now for the good news. The Ryan Budget does satisfy the Golden Rule of fiscal policy. As you can see in the chart, federal spending grows by an average of 3.4 percent annually, and that modest bit of fiscal discipline is enough to reduce the burden of government spending to 19.1 percent of economic output by 2023.

It’s also good news that the Ryan Budget calls for structural reform of entitlement programs, including Medicaid block grants and Medicare premium support. The budget also assumes the repeal of the costly Obamacare program.

And there’s also some good tax policy. Not bold tax reform like a flat tax, but top tax rates would be reduced to 25 percent and many forms of double taxation, like the death tax and capital gains tax, presumably would be reduced or eliminated.

Let’s be clear, though, that this is not a libertarian budget. Federal spending will still be far too high. Indeed, the budget will consume a larger share of the economy than it did when Bill Clinton left office.

And while Republicans do a good job of restraining spending in the first couple of years of the new Ryan Budget, outlays rise far too rapidly beginning around 2016.

Moreover, there’s no Social Security reform.

Equally worrisome, the budget assumes that the federal tax burden should remain at about 19 percent of GDP, higher than the long-run average of 18 percent of GDP and—for all intents and purposes—permanently enshrining Obama’s fiscal cliff victory.

And it’s depressing to see that the Ryan Budget has gotten weaker each year.

At this rate, it won’t be that long before the GOP budget and Obama budget converge.

Okay, that’s an exaggeration. But the moral of the story is that the Ryan Budget is a step in the right direction, but much more will be needed to restore limited, constitutional government.

Topics: 
General, Government and Politics, Social Security, Tax and Budget Policy

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