Prohibition and Mass Incarceration

In my last post, I noted promising support for marijuana legalization initiatives this fall. Still, outside libertarian circles, there​​ unfortunately isn’t the political will to support a broader repeal of our federal and state drug laws.

Before you say it: No, drug legalization will not solve our mass incarceration problem. Not all by itself, ​anyway​; ​the numbers just don’t add up. You can see that for yourself at the Urban Institute’s web-based prison population forecaster. As the Urban Institute notes,

While dramatically reducing the national prison population requires addressing the hard stuff—like long prison sentences and time served for violent offenses—reforms to drug laws and revocation policies will still go a long way in many states.

For example, nonviolent offenses are a major driver of the prison population in Alabama, Kentucky, Missouri, Oklahoma, and Texas, so sending fewer people to prison for drug and property crimes would have a big impact on incarceration rates. Halving drug admissions would cut the prison population by nearly 10 percent in each of those states by the end of 2021. And a 50 percent reduction in admissions for all nonviolent crimes would cut at least a quarter off their populations (nearly a third in Kentucky).

​For good or ill, the Urban Institute doesn’t ​consider libertarians’ first-best solution, which ​is​ of course the full legalization of all drugs​. Libertarians support this policy not just because ​it would help empty the prisons, but because it’s your body, and it’s your right to choose what goes into it.​

These propositions are obvious to us; if only they were more obvious to others. But as the success of marijuana legalization becomes increasingly apparent, I hope that a fuller legalization, also once laughed at, will come to be taken more seriously.

Venezuelan Regime Kidnaps Yon Goicoechea, Friedman Prize Winner

Members of what was surely the Venezuelan regime’s secret police yesterday kidnapped opposition leader and 2008 Milton Friedman Prize winner Yon Goicoechea from his car after he left his home. Diosdado Cabello, the second most powerful person in the regime, publicly announced that the government had arrested Yon on the bogus claim that he was carrying explosives. In the video broadcast on national television, Cabello referred to the $500,000 Friedman Prize award that Yon received as evidence that Yon was some sort of foreign-employed agent bent on terrorism. “That man was trained by the U.S. empire for years,” he said, “It looks like his money ran out and he wants to come here to seek blood. They gave him the order there in the United States.”

This is an old trick of the Chavista regime—distract attention from the severe political, economic and social crisis that it has inflicted on the country. Venezuela’s so-called Socialism of the 21st Century has produced shortages of everything from food and water, to medicine and electricity. Hunger is becoming widespread, the rate of violence is among the worst in the world, and the regime has become extremely unpopular. (We have commented on this downward spiral here, here, here, and here).

Yon won the Friedman Prize in 2008 for having led the student movement that played the central role in defeating the constitutional reform that would have given Hugo Chavez what at that time would have been an unprecedented concentration of political and economic power. One of Yon’s and the student movement’s central tenets is their advocacy of non-violence in the promotion of basic freedoms and democracy. Yon also offers an optimistic vision about the future and potential of his country (see his Friedman Prize acceptance speech here). That approach contrasts with the regime’s constant reliance on repression and force and helps explain its appeal to most Venezuelans. For the same reason, the government’s claim of terrorism on Yon’s part lacks any credibility. The idea that the Friedman Prize is awarded so that the recipient carry out specific tasks is also risible. The prize is given “to an individual who has made a significant contribution to advance human freedom,” and has no conditions attached to it whatsoever. It has been awarded to numerous freedom champions from around the world including prominent reformers and human rights and freedom of speech advocates.

Yon’s detention comes just prior to massive popular protests against the government that are planned for this Thursday. Sticking to the pattern it has followed over the past few years as the crisis has deepened, the regime is doubling down on repression rather than adjusting to political or economic reality. His kidnapping shows just how insecure the regime has become and the importance of speaking truth to power.

In the months and days prior to Yon’s detention, the regime has arrested other opposition leaders and activists. Nobody is sure exactly where Yon is being held or under what conditions (though we believe he is in a cell at the headquarters of the secret police in Caracas). The Venezuelan government stopped being democratic and respecting the rule of law years ago, but we nevertheless call on it to release Yon immediately and treat him with the basic rights to due process that should be afforded to any Venezuelan citizen.

Thomas Paine, Advocate of Sound Money and Banking

Between writing his well-known revolutionary liberal tracts Common Sense (1776) and The Rights of Man (1791), Thomas Paine contributed knowledgeably to a 1785-6 debate over money and banking in Pennsylvania. Paine defended the Bank of North America’s charter and it operations in a number of lengthy letters to Philadelphia newspapers during 1786, followed by a December monograph that summarized his case, Dissertations on Government; The Affairs of the Bank; and Paper Money.[1]

Paine argued that to repeal the bank’s charter violated both the rule of law and the maxims of sound economic policy. His writings show that he well understood the benefits of banking. Although proponents of the repeal accused Paine, publicly known to be in dire financial shape, of being paid by the BNA’s proprietors for defending it (one called him “an unprincipled author, who lets his pen out for hire”), Paine vociferously denied the charge, and historians (such as Philip S. Foner, who edited an anthology of Paine’s works), have found no evidence to support the accusation. Prima facie evidence for Paine’s sincerity is found in his marshalling of serious arguments that were consistent with the classical liberal principles of his earlier writings.

Can the United States, China and Russia Cooperate on Trade?

The 2016 G20 summit in Hangzhou is fast approaching and, similar to the pre-summit meetings hosted by China throughout the year, the focus will be the state of the global economy. Still contending with sluggish global economic growth, the summit’s theme of “Towards an Innovative, Invigorated, Interconnected and Inclusive World Economy” is especially timely. Under the umbrella of global economic growth, cultivating opportunities for trade and investment will become a major priority for G20 states, and three global powers—the United States, China, and Russia—are each developing their own multinational trade route projects. These major trade projects could serve as opportunities for cross-country cooperation and growth, but they could also become sources for future conflict.

China’s management of domestic markets, currency, and commitment to structural reforms was a cause for global concern at the first meeting of G20 Finance and Central Bank Governors in February. At next week’s summit, China’s President Xi Jinping will undoubtedly point out China’s efforts towards realizing supply-side structural reforms in the face of China’s “new normal” of slower economic growth. As part of these reforms aimed at rebalancing China’s economy, Beijing plans to cut industrial overcapacity, tackle overhanging debt, reform state-owned enterprises, and seek out new consumer markets. On the last point, Beijing is championing its New Silk Road Initiative (also known as “One Belt, One Road”), a major state project focused on opening up new markets. To accomplish this, Beijing is building vast trade networks spanning several countries and continents, by land and by sea. However, many countries are wary. The project, billed as purely an economic one, may evolve to include a political and/or military dimension as well.

The Problem with Income

Last week’s 20th anniversary of welfare reform event put income-based poverty measures on trial and drew skeptics from many circles. Michael Tanner stated that you would be hard-pressed to find “anyone on the left or right to defend the current [income-based] measure,” Robert Rector compared the current poverty measure to wearing glasses with cracked lenses, and Scott Winship presented research indicating income-based measurements distort U.S. poverty estimates.

Criticisms of the poverty metric during the event were only a microcosm of objections that have been occurring for some time.

Specifically, academics have taken issue with the failure of income-based poverty measures to accurately capture the realities of poverty. Measuring poverty incorrectly can have deleterious results, because it leads to misunderstanding the problem itself and, by extension, the solution.

So, what’s wrong with using income to measure poverty?

It turns out a lot, because income does not provide an accurate picture of economic well-being. It does not, for instance, provide information about an individual’s access to welfare benefits or access to formal or informal insurance. Income also can’t say anything about an individual’s accumulation of wealth or access to credit. Practically speaking, the income measurement often ignores dollars earned under-the-table on the so-called “gray market.” Importantly, for poor individuals, the resources that income overlooks are often substantially larger than income itself.

You Ought to Have a Look: Ethanol, Louisiana Floods, Carbon Tax Flip-flop

You Ought to Have a Look is a feature from the Center for the Study of Science posted by Patrick J. Michaels and Paul C. (“Chip”) Knappenberger. While this section will feature all of the areas of interest that we are emphasizing, the prominence of the climate issue is driving a tremendous amount of web traffic. Here we post a few of the best in recent days, along with our color commentary.

It looks like a new investigation into the use of ethanol as a substitute for gasoline found pretty much what most people have known all along—it’s just a bad idea.

Car mechanics know it. Drivers know it. Food analysts know it. Land conservationists know it. The last bastion of holdouts (aside from Midwestern corn farmers and their Congressional representatives) were the climate change do-gooders, claiming that all of the above sacrifices were small prices to pay for the benefit to the climate that ethanol was producing.  After all, they argued, burning ethanol produces fewer carbon dioxide emissions on net than burning “fossil” fuels because the carbon liberated in the process (for more on liberated carbon check out Andy Revkin’s contribution) was being recycled at a quicker rate than the geologic times scales necessary to produce oil.

While this may be technically true, it turns out that the rate of ethanol carbon recycling was being oversold by its supporters. At least this is the conclusion of a new paper authored by John DeCicco of the University of Michigan Energy Institute and colleagues. According to the paper’s press release:

A new study from University of Michigan researchers challenges the widely held assumption that biofuels such as ethanol and biodiesel are inherently carbon neutral.

Contrary to popular belief, the heat-trapping carbon dioxide gas emitted when biofuels are burned is not fully balanced by the CO2 uptake that occurs as the plants grow, according to a study by research professor John DeCicco and co-authors at the U-M Energy Institute.

The study, based on U.S. Department of Agriculture crop-production data, shows that during the period when U.S. biofuel production rapidly ramped up, the increased carbon dioxide uptake by the crops was only enough to offset 37 percent of the CO2 emissions due to biofuel combustion.

The researchers conclude that rising biofuel use has been associated with a net increase—rather than a net decrease, as many have claimed—in the carbon dioxide emissions that cause global warming. The findings were published online Aug. 25 in the journal Climatic Change.

Interestingly, the U.S. Environmental Protection Agency has recently been called to task for not investigating the supposed climate impact of the Congressionally mandated ethanol standards—a report that the EPA was required to produce by law. The EPA’s response: “we ran out of money and Congress didn’t pay attention to us last time we tried to issue a report.” But, they said they’d get right on it—and have a report ready by 2024.

We have a better idea: skip the report and just drop the standards.

North Korea: Friendly Proliferation May Beat a Nuclear Umbrella

The Obama administration is debating a declaration of no first use of nuclear weapons. Some Asia specialists fear the resulting impact on North Korea. But dealing with Pyongyang is a reason for Washington to encourage its ally South Korea to go nuclear.

Washington has possessed nuclear weapons for more than 70 years. No one doubts that the United States would use nukes in its own defense.

However, since then, Washington has extended a so-called “nuclear umbrella” over many of its non-nuclear allies. For instance, the United States long has threatened to use nuclear weapons in its NATO allies’ defense, though the precise circumstances under which the United States would act were not clear.

Northeast Asia is the region where nuclear threats seem greatest. Japan and South Korea are thought to be snuggled beneath America’s nuclear umbrella, which has discouraged both from acquiring their own weapons.