Topic: Government and Politics

Public School Spending. “Officials” vs. “Some Critics”

By
Andrew J. Coulson

The Wall Street Journal reports today that according to the latest Bureau of the Census figures there was a 0.4% drop in nominal U.S. public school operating spending from 2010 to 2011. The story then makes this unobjectionable factual observation:

Education officials say decreased spending will make it more difficult to prepare U.S. students for an increasingly competitive global marketplace. Some critics argue that public education costs are skyrocketing while academic achievement has not kept pace. They want the system overhauled before more money is spent.

What the story does not provide readers is any measure of student achievement that would allow them to determine who is right. Let’s see if we can help out. Below is an updated version of a chart some of you will already be familiar with. It shows the performance over time of U.S. 17-year-olds on the “Long Term Trends” testing program of the National Assessment of Educational Progress. The spending line corresponds to the trend in the total cost of a complete K-through-12 public school education (i.e., what it cost to send a high-school graduate all the way through public school). For good measure, it shows how the number of public school employees has roughly doubled since 1970–from about 3.3 to about 6.4 million people. 

So, who seems to be right: “Education officials” or “some critics”?

Incidentally, the WSJ only gives the partial “operating” figures for per-pupil spending. Actual total per pupil spending in 2010, adjusted to today’s dollars, was $13,871. That was down from the all-time inflation-adjusted high of $14,090 in the previous year. Still, $346,767 per class of 25 kids doesn’t seem too shabby.

Topics: 
Education and Child Policy, Government and Politics, Tax and Budget Policy

Can You Vague That Up for Me?

By
Trevor Burrus

As the IRS scandal thickens, targeted groups are coming out to describe their ordeals in dealing with that most-reviled of government agencies. The Ohio Liberty Coalition was one of the groups targeted by the IRS, and Tom Zawistowski of the OLC recently sat down with Cato’s Caleb Brown to discuss the experience.

Ohio Liberty Coalition versus the I.R.S. (Tom Zawistowski)

Among the many lessons we can take from this scandal is to realize how bureaucrats enforcing vague government regulations can chill free speech. Campaign finance laws are filled with vague regulations–such as whether an ad is the “functional equivalent of direct advocacy”–and they are anything but harmless to political speech.

In assessing applications for (c)(4) status, the IRS looked for whether political campaigning was an applicant’s “primary activity.” Due to the vagueness of this term, “rogue” IRS agents were free to harass applicants for the “content of their prayers” and other uncouth requests.

Advocates for campaign finance restrictions often do not understand how political speech can be killed by a thousand cuts as much as it can by one fatal blow. Some FEC regulations clearly prohibit certain types of spending. Others tell would-be speakers to judge whether their ads “in context, can only be interpreted by a reasonable person as advocating a candidate’s election or defeat.” Complying with these regulations ultimately comes down to a silly “magic words” test–that is, a search for words such as “vote for,” “elect,” “support,” etc.

Some campaign finance advocates who understand what Citizens United was actually about–that is, a non-profit corporation prohibited from showing a movie critical of Hillary Clinton on Pay-Per-View–concede that Citizens United should have narrowly won the case. Rather than allowing all corporations to spend independently in elections, as the case turned out, they argue the Court should have carved out an exception for “genuine ideological organizations,” “voluntary media choices” (Pay-Per-View), or some other vague criterion that would ultimately have been enforced by bureaucrats at the FEC. We can now can see how such vague standards are applied and abused. 

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Topics: 
Government and Politics, Law and Civil Liberties

Senators Levin and McCain: Two Peas All Up in our iPods

By
Daniel J. Ikenson

Earlier this year, Senator Carl Levin (D-MI) announced that he will be retiring after many, many, many decades of lawmaking when his term expires in January 2015. But he doesn’t intend to make for the exits without sealing his legacy of disdain for America’s wealth creators. After holding hearings last September to shed light on the “loopholes and gimmicks” employed by U.S. multinational companies to avoid paying their “fair share” of taxes, Levin resumed his inquisition today by holding a hearing intended to publically shame one of America’s most successful and most bountiful companies:

Apple sought the Holy Grail of tax avoidance. It has created offshore entities holding tens of billions of dollars, while claiming to be tax resident nowhere. We intend to highlight that gimmick and other Apple offshore tax avoidance tactics so that American working families who pay their share of taxes understand how offshore tax loopholes raise their tax burden, add to the federal deficit and ought to be closed.

Man, the spite in those words is palpable.

At the outset, it is important to note that no illegalities have been alleged, nor have any likely been committed. Like most other U.S.-based multinational corporations, who face tax rates of 35 percent on profits repatriated from abroad, Apple has tax avoidance specialists on its payroll to figure out the most effective ways to minimize their tax burden. They’d be sued for corporate malfeasance by their shareholders if they didn’t.

Unlike foreign-based multinationals whose governments don’t tax their profits earned abroad (or do so very lightly), U.S multinationals are subject to double taxation—first in the foreign countries where they operate at local tax rates and then by the IRS, at up to 35 percent, when profits are brought home. Well guess what? That system discourages profit repatriation, depriving the economy of working capital, and it encourages elaborate, legal tax avoidance schemes.

Oddly, Senator Levin’s problem is not with these perverse incentives, but with the act of following them. Thank you, sir, may I have another! But even worse, Senator John McCain (R-AZ) acknowledges the faults and disincentives of the system, but still casts the blame on those following Congress’s incentive structure:

I have long advocated for modernizing our broken and uncompetitive tax code, but that cannot and must not be an excuse for turning a blind eye to the highly questionable tax strategies that corporations like Apple use to avoid paying taxes in America. The proper place for the bulk of Apple’s creative energy ought to go into its innovative products and services, not in its tax department.

A company that found remarkable success by harnessing American ingenuity and the opportunities afforded by the U.S. economy should not be shifting its profits overseas to avoid the payment of U.S. tax, purposefully depriving the American people of revenue. It is important to understand Apple’s byzantine tax structure so that we can effectively close the loopholes utilized by many U.S. multinational companies, particularly in this era of sequestration.

Apple’s byzantine tax structure?

Should Apple be blamed for optimizing according to the legal incentives created by the likes of Senators Levin and McCain? Rather, the public would be better served if Senators Levin and McCain were hauled before a public panel to explain why the tax system they helped create and have failed to reform penalizes U.S. companies, and discourages domestic reinvestment.

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Topics: 
Government and Politics, Tax and Budget Policy, Trade and Immigration

The “I-Word” Isn’t a Curse

By
Gene Healy

I’m not convinced that any of the recent scandals roiling the Obama administration constitutes an “impeachable moment,” but, as I argue today in the Washington Examiner, there’s something wrong with a (post-?) constitutional culture where opinion leaders treat the very invocation of the “I-word” as akin to screaming obscenities in a church.

Impeachment talk is “industrial strength insane” says the Daily Beast’s Michael Tomasky; “serial madness,” per Richard Brodsky at the Huffington Post; Rachel Maddow compares it to incontinence; and for the Atlantic’s Philip Bump, it’s like the inevitable idiot in the comments thread invoking Hitler. True, Salon’s recent listicle of 14 “crazy times” right-wingers have called for Obama’s impeachment consists mostly of frivolous, even loopy proposals; but it also includes Bruce Fein’s 2011 call to impeach Obama “over the military intervention in Libya, alleging that it violated the Constitution’s mandate that only Congress can declare war.” Crazy talk!

Also in the Atlantic, “communitarian” godfather Amitai Etzioni moans “I see no way to protect the president and all of us from the second term curse” in a piece titled, “Why It Should Be Harder to Impeach a President.“ 

“Harder”? A “reality-based” communitarian Etzioni ain’t. In our 224-year constitutional history, we’ve only managed the feat twice—three times if you count Nixon, who resigned before the full House got to vote. How much harder can it get?

And when did calling for—even musing about—a president’s impeachment become a form of secular blasphemy—the American version of Lèse-majesté? 

Given what the mid-’70s Church Committee hearings revealed about presidential abuses of power, at a minimum, all three presidents of the ’60s deserved to be impeached and removed from office. Of the seven presidents since Nixon, I can make a case for impeaching at least four.

As Ben Franklin put it at the Philadelphia Convention, the impeachment power is “the best way… to provide in the Constitution for the regular punishment of the Executive when his misconduct should deserve it, and for his honorable acquittal when he should be unjustly accused.”

Our problem isn’t too many impeachments, but too few.   

Topics: 
General, Government and Politics

Cato’s “Deepbills” Project Advances Government Transparency

By
Jim Harper

It’s not the culmination–that will come soon–but a major step in our work to improve government transparency has been achieved. I’ll be announcing and extolling it Wednesday at the House Administration Committee’s Legislative Data and Transparency conference. Here’s a quick survey of what we’ve been doing and the results we see on the near horizon.

After president Obama’s election in 2008, we recognized transparency as a bipartisan and pan-ideological goal at an event entitled: “Just Give Us the Data.” Widespread agreement and cooperation on transparency has held. But by the mid-point of the president’s first term, the deep-running change most people expected was not materializing, and it still has not. So I began working more assiduously on what transparency is and what delivers it.

In “Publication Practices for Transparent Government” (Sept. 2011), I articulated ways the government should deliver information so that it can be absorbed by the public through the intermediary of web sites, apps, information services, and so on. We graded the quality of government data publication in the aptly named November 2012 paper: “Grading the Government’s Data Publication Practices.”

But there’s no sense in sitting around waiting for things to improve. Given the incentives, transparency is something that we will have to force on government. We won’t receive it like a gift.

So with software we acquired and modified for the purpose, we’ve been adding data to the bills in Congress, making it possible to learn automatically more of what they do. The bills published by the Government Printing Office have data about who introduced them and the committees to which they were referred. We are adding data that reflects:

- What agencies and bureaus the bills in Congress affect;

- What laws the bills in Congress effect: by popular name, U.S. Code section, Statutes at Large citation, and more;

- What budget authorities bills include, the amount of this proposed spending, its purpose, and the fiscal year(s).

We are capturing proposed new bureaus and programs, proposed new sections of existing law, and other subtleties in legislation. Our “Deepbills” project is documented at cato.org/resources/data.

This data can tell a more complete story of what is happening in Congress. Given the right Web site, app, or information service, you will be able to tell who proposed to spend your taxpayer dollars and in what amounts. You’ll be able to tell how your member of Congress and senators voted on each one. You might even find out about votes you care about before they happen!

Having introduced ourselves to the community in March, we’re beginning to help disseminate legislative information and data on Wikipedia.

The uses of the data are limited only by the imagination of the people building things with it. The data will make it easier to draw links between campaign contributions and legislative activity, for example. People will be able to automatically monitor ALL the bills that affect laws or agencies they are interested in. The behavior of legislators will be more clear to more people. Knowing what happens in Washington will be less the province of an exclusive club of lobbyists and congressional staff.

In no sense will this work make the government entirely transparent, but by adding data sets to what’s available about government deliberations, management and results, we’re multiplying the stories that the data can tell and beginning to lift the fog that allows Washington, D.C. to work the way it does–or, more accurately, to fail the way it does.

At this point, data curator Molly Bohmer and Cato interns Michelle Newby and Ryan Mosely have marked up 75% of the bills introduced in Congress so far. As we fine-tune our processes, we expect essentially to stay current with Congress, making timely public oversight of government easier.

This is not the culmination of the work. We now require people to build things with the data–the Web sites, apps, and information services that can deliver transparency to your door. I’ll be promoting our work at Wednesday’s conference and in various forums over the coming weeks and months. Watch for government transparency to improve when coders get a hold of the data and build the tools and toys that deliver this information to the public in accessible ways.

Topics: 
Government and Politics, Telecom, Internet & Information Policy

I Hate to Say “I Told You So” (Spying on the Press Edition)

By
Julian Sanchez

On Friday, I wrote a piece for Mother Jones speculating that government spying on press communications may not be “unprecedented,” as Associated Press head Gary Pruitt put it, but simply rarely disclosed. The rules requiring disclosure of such surveillance, after all, only appear to apply to “subpoenas” for “telephone toll records,” not secret tools like National Security Letters. Even outside the shadowy world of intelligence, as federal magistrate judge Stephen Smith has observed, court orders granting government access to electronic communication records routinely remain secret indefinitely. I suggested that there could be quite a few other cases like the AP story that we’ve simply never heard about, even if the Justice Department scrupulously follows its own rules, because they didn’t involve grand jury subpoenas for phone logs.

It is rare for someone who writes about the intelligence community to have a speculation of this sort confirmed almost instantly, but a report in the Washington Post today is already shining a spotlight on another hitherto unreported leak investigation in which the government obtained a warrant to read the e-mail of Fox News reporter James Rosen. The warrant in that case was sealed for over a year, and appears to have remained unnoticed until today—nearly three years after the search of Rosen’s e-mail was authorized. Why should anyone believe this is the only such case that hasn’t yet come to light?

The Rosen case is especially unsettling because the warrant affidavit suggests that Rosen himself could be subject to prosecution under the Espionage Act, on the grounds that his alleged encouragement to a source to provide classified information amounts to “conspiracy.” The attempt to redefine as crime what is ultimately a routine and necessary part of national security reporting really is rather unprecedented: As the Congressional Research Service has observed, “we are aware of no case in which a publisher of information obtained through unauthorized disclosure by a government employee has been prosecuted for publishing it,” and there “may be First Amendment implications that would make such a prosecution difficult.”

A successful prosecution, of course, is not necessarily the point. The case against NSA whistleblower Thomas Drake—who revealed massive waste in the Agency’s deals with intelligence contractors—ultimately collapsed: The information he’d revealed was embarrassing to the government, not dangerous to national security. But Drake’s life had still been shattered, and a clear message sent to any others who might seek to embarrass the government. Reporters are already feeling the chilling effects of the AP leak investigation—and presumably that’s the real aim: Not to jail leakers as an end int itself, but to ensure that government sources are too scared to talk to press without approval.

That might sound like a fine idea if we were really only talking about vital national security secrets whose publication would endanger the United States. But as even top intelligence officials have acknowledged, “overclassification” is rampant in government. Much of the most basic information, without which effective national security reporting would be impossible, is reflexively classified whether or not it poses any realistic security risks, and reporters routinely discuss such information. In practice, that means the government can pick and choose which leakers to go after—and which ones to wink at because they’re serving the administration’s interests.

Topics: 
Government and Politics, Telecom, Internet & Information Policy

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