Topic: Government and Politics

Cass Sunstein and the Cato Institute

The Washington Post is reporting that Harvard law professor Cass Sunstein will be named director of the Office of Information and Regulatory Affairs, the White House’s regulatory review office. The appointment is baffling, not because the Obama administration has chosen Sunstein (he is a first-rate thinker), but because Sunstein has (apparently) accepted it. OIRA chief is one of the most thankless jobs in Washington, and the office has historically shown itself to be a victim of the political winds no matter how sharp-minded and sincere the chief is.

Sunstein would not fit the label “libertarian,” but he is, in his own way, a supporter of liberty. And he has been a good friend to the Cato Institute, speaking here and writing for Regulation (1, 2).

I wish Cass well in this difficult new job.

Does Congress Deserve a Pay Hike?

Richard Rahn suggests they do not:

Most of us would like to be in the position of voting for our own pay raises from an employer who has almost unlimited access to money … . Given that members of Congress were in a large part responsible for the current economic mess, it is hard to see how they can justify a raise … .

Well, at least three bills in the new 111th Congress would deny members a pay increase in fiscal 2010.

One of them should be attached to any big “stimulus” spending bill. But I imagine Congress is less interested in shows of rectitude from its own membership than from the business leaders it has bailed out.

Enjoy the Bowls—You’re Paying for Them

In the Wall Street Journal, Mark Yost explores the taxpayer subsidies to major college football bowl games:

while everyone’s fretting over the bailout package for the auto industry, most taxpayers would be shocked to learn that they’re also footing the bill for some of these highly profitable bowl games. From 2001 to 2005, seven tax-exempt bowls received $21.6 million in government aid.

During that time, 38 percent of the Brut Sun Bowl’s revenue came from a Texas rental-car tax. Now that’s Brutish.

And what do the bowls do with those taxpayer dollars? Well, they put on a football extravaganza, of course. But also:

To ensure the bowl games maintain their tax-exempt status, the committees hire state and federal lobbyists. Watts Partners, the Washington, D.C., lobbying firm run by former University of Oklahoma quarterback and Rep. J.C. Watts, has been paid more than $500,000 in consulting fees by the BCS.

So, as happens with many other government-funded enterprises, taxpayers’ money is spent on lobbyists to keep the taxpayers’ money flowing. Some of the money also goes to pay bowl executives upwards of $400,000. Leaving aside the issue of why tax-funded entities should pay their executives more than the president of the United States, I’m not surprised that bowl committees pay a CEO a handsome salary to make everything work perfectly. But I wonder: We hear a lot of complaints about the high pay of corporate CEOs. If the executive director of a $30 million bowl game is paid $400,000, how much should the CEO of a $30 billion company get?

More on taxpayer subsidies for sports business here and here. A lengthy bibliography here (pdf).

$1.2 Trillion Deficit

Before 1987, Americans only needed to understand the word “billion” to get a handle on federal budget numbers. Today, the word “trillion” is the needed metric in budget discussions.

The Congressional Budget Office released an update to its budget projections today, and the figures show that the federal deficit for fiscal 2009 will be $1.2 trillion. That deficit represents 8.3 percent of GDP, the highest share of the economy since World War II. Thus, a burden the size of 8 percent of all income earned in the United States this year is being thrust onto tomorrow’s taxpayers.

Here are some other observations on the data:

- If Congress passes a so-called stimulus package in coming weeks of say $800 billion, the 2009 deficit will top $2 trillion. Even the biggest critics of Washington’s spendthrift ways never thought they would see a number like that.

- The CBO shows federal spending in 2009 will be about $3.54 trillion. This number includes the spending effect of TARP and the federal takeover of Fannie and Freddie. But let’s consider those to be extraordinary items and take them out for a minute. And let’s add in $24 billion more for Iraq this year, as CBO indicates. The result is that – even aside the financial bailouts – federal spending would be about $3.165 trillion this year. That figure is up 6.3 percent over 2008, and up 70 percent over 2001, Bush’s first year in office.

- The CBO puts the deficit in fiscal 2010 at $703 billion. But that low-balls Iraq costs again, and doesn’t include extension of the AMT and other minor expiring tax provisions. Add those in, and the deficit in 2010 will be at least $829 billion.

Keynesian economists believe that government budget deficits “stimulate” the economy during a recession. But we’ve got $1.2 trillion this year and $800 billion next year of deficit “stimulus” without any special “stimulus” package.

Isn’t that enough? If I get up in the morning and drink five cups of coffee and that doesn’t stimulate me, I don’t go and drink another five. I’d recognize my addiction problem and start reforming my bad habits. Federal policymakers should do the same.

Senator Hatch Gets Less than a Mess of Pottage

With an expanded Democratic majority in Congress, Democrats are pushing to get the District of Columbia a vote in the House of Representatives, instead of the nonvoting delegate that the District has, like Puerto Rico, Guam, American Samoa, and the Virgin Islands. They have one powerful Republican ally, Sen. Orrin Hatch of Utah, former chairman of the Judiciary Committee. He’s introducing the bill in the Senate along with Joe Lieberman.

Now Senator Hatch is a great constitutionalist. On his official website he writes

Adhering strictly to the Constitution and the system of government our Founders outlined is the best guarantee of the freedoms we cherish as Americans. We need legislators, judges, and citizens who understand the view of the Constitution envisioned by our Founding Fathers… .

Our Constitution is an inspired document that has preserved the unity of our nation, protected the rights of its citizens, and made America a beacon of freedom and prosperity for the world. I consider my pledge to defend the Constitution, and all that it stands for, to be among my most sacred duties.

But that poses a bit of a problem for his position on D.C. voting rights in Congress. Article I, Section 2, of the Constitution begins, “The House of Representatives shall be composed of members chosen every second year by the people of the several states.” The District of Columbia is not a state, and so it is not eligible to elect a member of the House of Representatives. Some constitutional issues are complicated. This one is not. States are represented in the House, and the District is not a state.

So why is Sen. Hatch (R-Utah) willing to ignore the clear language of the Constitution in order to give the District of Columbia a vote in the House of Representatives? Because he’s made a political deal that would also give Utah another seat in Congress. That way, you see, the Democrats get another vote from the District, and the Republicans would likely pick up a new Utah seat. The excuse for this deal is that Utah narrowly lost a fourth seat in the 2000 redistricting, arguably because the Census Bureau excludes overseas missionaries from a state’s apportionment count. Utah produces lots of Mormon missionaries. So Congress would increase the number of seats in the House to 437, with the additional seats temporarily assigned to D.C. and Utah.

So this bill is blatantly unconstitutional. And what is Senator Hatch (along with Sen. Robert Bennett and the rest of the Utah delegation, except for new Rep. Jason Chaffetz) getting for this corrupt bargain? Another vote in the House of Representatives for two years. The bill would allow Utah and D.C. to elect representatives to the 112th Congress in November 2010. But Utah’s population growth almost certainly will result in its getting a fourth seat in the 2010 census anyway, so in the regular order of things it would have four seats in the 113th Congress elected in 2012. That means that all this whistling past the Constitution on the part of Utah’s members of Congress is to get one more vote for two years. Meanwhile, of course, the unconstitutional vote for the District of Columbia would be permanent.

It reminds me of the wonderful line from A Man for All Seasons when Sir Thomas More, thinking his friend Richard Rich has sold out his honor for very little, asks him (alluding to Matthew 16:26): “It profits a man nothing to give his soul for the whole world. But for Wales?”

Senator Hatch and the state of Utah would trade the Constitution for one vote out of 437 for two years.