Topic: General

Mart Laar, Friedman Prize Winner

Tonight, in Chicago, Cato is hosting the formal presentation of the third biennial Milton Friedman Prize for Advancing Liberty. This year’s winner is Mart Laar, the former prime minister of Estonia responsible for guiding his country’s successful transition from communism to a democratic market economy.

We are now in the fifteenth year since the collapse of the Soviet Union, and unfortunately many of the former Soviet republics have made little progress in either economic or political reform. Estonia, however, is a glittering exception. According to the Economic Freedom of the World report, the country now ranks 12th out of 127 countries in economic freedom. Freedom House gives Estonia its highest rankings for both political rights and civil liberties. And the World Economic Forum rates Estonia 20th out of 117 in its Growth Competitiveness Index.

For Laar to win the Friedman Prize is especially fitting, since Laar’s bold free-market reforms were inspired by Friedman himself. Before entering politics, Laar was a historian. “I had read only one book on economics – Milton Friedman’s Free to Choose. I was so ignorant at the time that I thought that what Friedman wrote about the benefits of privatization, the flat tax and the abolition of all customs rights, was the result of economic reforms that had been put into practice in the West. It seemed common sense to me and, as I thought it had already been done everywhere, I simply introduced it in Estonia, despite warnings from Estonian economists that it could not be done. They said it was as impossible as walking on water. We did it: we just walked on the water because we did not know that it was impossible.”

Here is Laar’s 1992 book, War in the Woods, on Estonian resistance to Soviet occupation during and after World War II. And here is a paper presented by Laar at a 2004 Cato conference in Russia on Estonia’s reform experience.

Rapanos v. United States: The Blog

The Pacific Legal Foundation is the lead counsel in one of the biggest cases of the Supreme Court’s current term: Rapanos v. United States, a case involving egregious interference with private development by federal and state environmental regulators. In anticipation of the Court’s decision, PLF has started a blog on the case, which you can access here. For more Rapanos fun, read a short Wall Street Journal write-up about the story behind the case here. You can read the Cato Institute’s amicus brief in the case (written by yours truly) here.

The Left vs. Conservation

I was on NPR’s “News & Notes with Ed Gordon” today to discuss gasoline prices with Julianne Malveaux. It was a rather bizarre experience. Apparently, the Left is of many, many minds when it comes to energy conservation—and all of those minds seem to coexist in the same head.

On the one hand, Dr. Malveaux was quite adamant that we need to “incentivize people” (her phrase) to use mass transit. But, on the other hand, she was equally adamant that gasoline prices were too high and had to be brought down by hook or crook.

Question 1: Wouldn’t increasing the marginal cost of driving provide the most powerful incentive for people to use mass transit?

Question 2: Wouldn’t decreases in marginal driving costs reduce the incentive people would have to use mass transit?

I tried to press her on those points but couldn’t get a straight or even understandable answer out of her.

When I tried to point out that how much people spend on gasoline is largely under their control and that high gasoline costs will do more to encourage conservation than anything government could do, I was treated to a rather loud rant about why most people had no option but to keep buying gas and that only ivory tower, doctrinaire Cato types would ever believe to the contrary.

Now, this is really something. Up until recently, environmentalists and conservationists have gone on at quite some length about how people can and should conserve energy. When I took a page from that book and suggested that people could sell their SUVs, pickups, and luxury sedans for more fuel efficient cars, I was told that this would be too expensive for working Americans to even consider (huh?). When I suggested that people could move closer to work or to mass transit hubs if they wanted to cut their commute costs, I was accused of crazy talk. When I suggested that car-pooling is always possible for those who don’t want to pick up stakes, I was informed that this is yet more crazy talk. When I suggested that people may want to rethink how often and how far they drive around town on errands or the nature of their summertime vacations, I was accused of peddling nonsense. When I argued that high gasoline prices are actually something that conservationists and environmentalists should embrace, I was dismissed as a nutcase.

Apparently, all that talk about conservation from the Left was smoke. It’s actually an impossible task, quite beyond the capabilities of mere mortals.

Reflexive Militarism

Some have charged that President Bush’s plan to deploy 6,000 National Guardsmen to support roles along our border with Mexico constitutes “militarizing the border.” Well, sort of. But “security theater” is probably a better term. It’s a highly visible move designed to provide the appearance of increased security without actually increasing it, much like the use of guardsmen at the airports following September 11th.

In this case, the troops will be “operating surveillance systems, analyzing intelligence, installing fences and vehicle barriers, building patrol roads, and providing training,” according to the president’s speech Monday night. They will be under the command of the state governors, they will not have arrest authority, and they will not be involved in direct law enforcement activities, which means that there’s no objection based on the Posse Comitatus Act, the longstanding federal statute that restricts use of federal troops to “execute the laws.” On the whole, this is a far cry from some of the proposals for hard-core border militarization floating around on the right.

Yet the Bush administration does have a tendency, when faced with political trouble, to reach for the military. Trying to look decisive in the wake of Katrina last fall, the president asked for major revisions to Posse Comitatus twice in the space of a month, once to fight hurricanes and once to order military quarantines for Avian flu. Monday’s proposal is merely the latest iteration of the administration’s reflexive militarism, and it’s a comparatively mild one at that.

But here’s something a little more troubling than the upcoming exercise in security theater at the border. In the administration’s internal legal analysis, the Posse Comitatus Act may be vulnerable to going “poof,” as yet another statute touched by the Magic Scepter of Inherent Authority. There are a lot of bad ideas floating around about domestic militarization of the war on terror. If there’s another serious terror attack, that legal theory could be used to make some of those bad ideas happen.

GOP Proposes $1.7b More for Medicare Rx

A couple of days ago, I blogged that Republicans are thinking about eliminating the late enrollment penalty for Medicare Part D. Reneging on that penalty would (1) defeat the only sensible aspect of Part D, (2) increase the tax burden of Part D by $1.7 billion over five years, and (3) ruin the credibility of future cost-containment efforts that hinge on changing seniors’ behavior.

Lo and behold, the drive to eliminate the late enrollment penalty has begun. Front and center is the Republican chairman of the Senate Finance Committee—Chuck Grassley of Iowa. Co-sponsors of Grassley’s bill include such conservatives as Jon Kyl (R-AZ) and Rick Santorum (R-PA).

And the Republican campaign to expand the federal government marches on…

Are Three Federalist Society Lawyers Threatening the Supreme Court?

In a monograph released yesterday—but not-quite-technically-endorsed by—the Federalist Society, leading NSA defenders Andrew McCarthy, David Rivkin and Lee Casey appear, Sopranos style, to issue veiled threats to the Supreme Court, warning the justices not put their dirty mitts on the NSA surveillance program, or else.

Here’s some of the evidence:

Page 44: MRC argue that the President has a duty to “fight back” against branches that encroach on his constitutional turf. Specifcially, they say:

the departments were not expected [by the Framers] to take intrusions [on their constitutional authority] lying down … . To the contrary, when the actions of one branch invaded another’s turf, the offended branch was expected to fight back – in truth, was obliged to do so if liberty and constitutional governance were to be vindicated.

Might that duty to “fight back” include a duty by the President (who is constitutionally “preeminent” and “supreme” in foreign affairs, they say) to fight against the incursions of the Supreme Court? Seemingly, the answer is yes, because …

Page 64: The Constitution “contemplates no role for the federal courts in connection with the political judgments whether to conduct surveillance to secure the nation against hostile outsiders.” If the President must “fight back” against other branches’ unconstitutional incursions, and courts have no constitutional authority over surveillance, then MRC seem to be saying the President must fight back not just against Congress but against the Supreme Court.

Page 89: That hint gains more force when MRC conclude by suggesting the Court is the enemy both of security and liberty: “[I]njecting unelected federal judges into the prototypically political arena of foreign intelligence collection,” where “the collective security of the Nation is paramount,” is the “antithesis” of “the protection of the individual and his liberties.” Indeed, (moving on to page 93) “it is not at all clear why Bush administration critics view federal judges as inherently more liberty-conscious than politically accountable executive branch officials.” That’s why, say MRC, “the notion that every single executive activity … has to be checked either by Congress or the judiciary, is absurd.”

In other words, they say, Court interference with the President is unconstituitonal, dangerous to public welfare, antithetical to the preservation of liberty, and simply absurd. The President, in turn, is “obliged” to fight back against other branches when constitutional principle, public welfare, and liberty is at stake. You can fill in the blank spaces: The tenor of the piece is a veiled threat, sotto voce, that the President has the right—indeed the constitutional and even moral duty—to ignore not just Congress but the Supreme Court in its conduct of NSA surveillance.

We are entering a new era of indefinite terrorist crisis. The stakes couldn’t be larger for the principle of judicial supremacy. The Supreme Court faces a tough fight to preserve its role to “say what the law is” and to maneuver the political branches into a settled, agreed-upon framework of twenty-first century security law—made all the more tough by the perilous anti-judicial atmosphere to which Andrew McCarthy, David Rivkin and Lee Casey have now added their own distinctive contribution.

Republicans Need to Relearn How to Govern; Democrats Need New Policy Ideas

Harold Meyerson (Washington Post, May 10) was wrong to conclude that “The emerging Republican game plan for 2006…(reflects) their bankruptcy of ideas.” The Republican problem is not their lack of ideas but that the Bush administration has confused the politics of governing with the politics of campaigning. In 2005, President Bush proposed or endorsed major reforms of social security, taxes, immigration, and tort law. Most of these proposed reforms have not yet been addressed because the Bush administration would not work with Democrats to find a common ground, and the Democratic leadership would not even acknowledge the problems of current law that these proposed reforms would address. The prospect for comprehensive immigration reform is better only because of substantial support among the Democrats.

For all that, it is the Democratic Party that has been bankrupt of appealing policy ideas for the past 30 years. Marty Peretz, the editor of the New Republic, recently remarked that

It is liberalism that is now bookless and dying. Who is a truly influential liberal mind in our culture? Whose ideas challenge and whose ideals inspire? There’s no one, really. What’s left is the laundry list: the catalogue of programs…that Republicans aren’t funding, and the blogs, with their daily panic dose about how the Bush administration is ruining the country.

The policy proposals that are now bubbling up from the congressional Democratic leadership are a grab-bag of old ideas, some of which are remarkably dumb. An increase in the minimum wage is dumb because it reduces the employment of the least-skilled members of the labor force with most of the benefits accruing to secondary workers in non-poor families. An increase in the fuel economy standards is dumb because it reduces the cost of driving and applies only to new vehicles. One proposal that merits serious bipartisan attention is to revive the pay-as-you-go rules on federal spending and taxation that expired in 2002.

In summary, the Bush administration needs to learn how to govern, and the Democrats need to generate some appealing new policy ideas.