Law and Disorder in Philadelphia

This mini-documentary does a great job of capturing how the drug war is wreaking havoc in our cities.  Police engage in a futile game of cat & mouse with low level “corner boys.”  Gang members kill one another over turf (drug sales territory).  And the chasm between the ordinary residents and the government (police, prosecutors) is palpable.  The police are frustrated by the lack of citizen cooperation.  Witnesses and victims do not come forward with information, for example.  But there is little mystery here.  If the police cannot protect witnesses from retaliatory attacks, coming forward is practically suicidal.   Criminals oversee a thriving black market drug trade while policymakers dither about drug courts and “Plan Colombia.”

Excellent work, Mr. Theroux.  These festering problems are too often ignored by our MSM.  Americans get excessive coverage of OJ Simpson, Natalie Holloway, and Caylee Anthony.  For scholarly work on the drug war go here, herehere, and here.     If you liked this mini-doc, be sure to check out The Wire.

More Like $355 Million Per Plane, but Who’s Counting?

Today’s New York Times reports:

Two of President-elect Barack Obama’s stated goals — cutting wasteful spending and saving or creating millions of jobs — are on a collision course in a looming decision over whether to keep building the F-22 fighter jet.

That is a dubious claim. The predicted job losses associated with allowing the F-22 program to come to an end are exaggerated, and insignificant when compared against the many other jobs in our $13 trillion economy. Yes, some people currently employed manufacturing F-22s might have to find new work, but these workers should not receive special treatment; military necessity, not politics, should drive our decisions on what military hardware to buy. By that standard, the F-22 program should be terminated because the plane is ill-suited to the types of missions that the U.S. military is likely to undertake.

But the more egregious error pertains to the Times’s use of Air Force and industry estimates for per unit F-22 costs going forward. “Supporters of the F-22 program…argue that Mr. Obama should extend its production, at least temporarily, to preserve thousands of jobs related to building the jets, which cost $143 million each.” (my emphasis)

The actual per unit costs of each F-22 can be compiled from other figures cited in the story. To date, the F-22 program has cost taxpayers $65 billion, and has delivered 183 aircraft. My calculator doesn’t do real well with so many zeroes, but that comes out to more than $355 million – making the F-22 the most expensive fighter aircraft in history.

The Air Force contends that it is unfair to translate all of the program’s research and development costs into the price tag of the newest planes rolling off the assembly lines. According to this creative accounting, the “flyaway” costs of prospective purchases, which essentially write off program R&D as sunk costs, will range between $176.8 million and $216.3 million per aircraft. This assumes, however, that this next stage of F-22 production will not encounter any of the cost growth that has plagued the program from the very beginning. At every stage of its development, actual F-22 costs have exceeded projections. Even the flyaway estimates have proved woefully inaccurate. (In 1986, the Air Force estimated F-22 flyaway costs at $35 million.) When weighing the prospects of additional F-22 purchases, it seems prudent to assume that the plane will cost much more than its supporters want you to believe.

If President-elect Obama is serious about cutting wasteful spending, the F-22 is a pretty good place to start. The contention about jobs saved or lost is a red herring. So-called military Keynesianism might have been popular in the 1960s, but subsequent research has shown that expecting to stimulate the economy through military spending is a bad bet.


Don’t blame me, I gave him an “F.

From the Cato Report Card on the Governors:

Rod Blagojevich … has been relentless in his advocacy of large tax increases on businesses. In 2007, he pushed for a massive $7.1 billion annual tax increase in the form of a business gross receipts tax and increased payroll taxes, the largest proposed or enacted hike of any governor in this study. Blagojevich has proposed schemes to wallop businesses nearly every year, including plans to raise taxes on refineries, gaming businesses, software companies, and businesses in general through “loophole” closing initiatives. His approach ignores that Illinois is competing against other states and nations for investment in the global economy.

When doing the study, I wondered how a governor could be so reckless with the economy of his state. We know the answer now: There appears to be a total and complete lack of public interest sentiment in this character. It is all me, me, me.

The Pope Launches Ill-Informed Attack Against Low-Tax Jurisdictions

It is troubling so see collectivists (perhaps deliberately) confuse the acts of personal compassion and charity with the coerced redistribution imposed by government. This moral bankruptcy is particularly disappointing when it comes from religious leaders. The Pope, for instance, has launched an attack against so-called tax havens. As the UK-based Guardian reports, he apparently believes that low-tax jurisdictions somehow caused the financial crisis and he argues that the developing world will grow faster if corrupt politicians get more money to spend:

The Roman Catholic Church is calling for the effective closure of secretive tax havens as a ‘necessary first step’ to restore the global economy to health. In a policy paper from the Holy See, Pope Benedict pins the blame for the international financial crisis largely on ‘offshore centres’… The Pope points to estimates that the global fiscal deficit caused by offshore activities could amount to a staggering $255bn (£175bn) which is ‘more than three times the entire sum of [global] development aid’. …the reflection paper argues that tax havens, which banks use to escape the gaze of international financial watchdogs, facilitate the transfer of wealth from poverty-stricken nations to the rich world. …Intriguingly, the Vatican Bank…makes very limited financial disclosures, but the Rev Thomas Resse in his book Inside the Vatican claimed a cardinal told him in 1994 that it had $4bn in deposits and an annual income of $40m. Many experts believe this to be a spectacular underestimate.

This is not the first time the Pope has sided with big government over people. I addressed this issue last year, but he inexplicably missed my post on this topic. I guess this means the Pope has not watched my three-part series on tax havens. The Economic Case for Tax Havens would show him how low-tax jurisdictions boost global economic performance. The Moral Case for Tax Havens would warn him of the unpleasant consequences of giving too much private information to corrupt, venal, and incompetent governments. And Tax Havens: Myths vs. Facts would explain to him why attacks against low-tax jurisdictions are empty demagoguery. If the Pope is not a fan of, he would benefit from reading Tim Ridley’s column, which was published by Cayman News Service:

Pope Benedict commands huge respect but one wonders where his advisors are getting their economic and financial advice, possibly from the German Finance Minister or the French President, since it is so misguided and wide of the mark. On the first point, there is clear and incontestable evidence where the current crisis started, but it bears repeating that its origins were in the bad lending practices and financial engineering of regulated entities in major onshore economies, not in offshore centres. On the second point, His Holiness should also look much closer to home. The Vatican has a very patchy history of transparency, fiscal accountability and rectitude. It also has no problem with its own tax free status. It cut a deal with Mussolini in 1929 that effectively made the Holy See a tax haven itself.

…to charge that small economies that are able to operate without direct taxation and have thriving financial services industries are ipso facto responsible and punishable for the evils of tax evasion and official corruption beggars belief. Those charities, politicians, bureaucrats and now it appears, the Catholic Church, that clamour for the summary conviction and elimination of these small countries (who have few international votes and limited bargaining strength) should think long and hard about the implications if they get what they wish for. Small Islands like Bermuda, the Bahamas, the British Virgin Islands and the Cayman Islands will be impoverished and consigned back to the poverty of times gone by. The despots of the world will continue to find ways to pillage their countries’ treasuries and to have the proceeds available in one form or another in onshore financial centres in Europe and elsewhere (convenient after all for Harrods and Bergdorf Goodman). Will Oxfam, Christian Aid and the Vatican then send care packages to both Zimbabwe and the Cayman Islands?

Shocked, Shocked.

Sen. Jon Kyl (R.-AZ) on the judicial filibuster, circa 2005 [.pdf]:

Republicans seek to right a wrong that has undermined 214 years of tradition – wise, carefully thought-out tradition. The fact that the Senate rules theoretically allowed the filibuster of judicial nominations but were never used to that end is an important indicator of what is right, and why the precedent of allowing up-or-down votes is so well established. It is that precedent that has been attacked and which we seek to restore….

My friends argue that Republicans may want to filibuster a future Democratic President’s
nominees. To that I say, I don’t think so, and even if true, I’m willing to give up that tool. It was never a power we thought we had in the past, and it is not one likely to be used in the future. I know some insist that we will someday want to block Democrat judges by filibuster. But I know my colleagues. I have heard them speak passionately, publicly and privately, about the injustice done to filibustered nominees. I think it highly unlikely that they will shift their views simply because the political worm has turned.

Uh, never mind:

Jon Kyl, the second-ranking Republican in the U.S. Senate, warned president-elect Barack Obama that he would filibuster U.S. Supreme Court appointments if those nominees were too liberal

For the case against the case against the judicial filibuster, check here and here. For good arguments against the JF, check here.

US Schools: Spending Leaders, Middling Performers

The latest international test results were released this morning, and the U.S. is getting favorable early coverage for scoring anywhere between the top 3rd and the top 6th of the pack, depending on the subject and the grade. But many poor nations participate in TIMSS (the Trends in International Mathematics and Science Study) giving an inflated impression of how well we actually perform compared to our economic peers.

The picture changes when we consider only those nations that are among the top-30 in terms of gross national income per capita. Limited to those nations, the U.S. places 6th out of 11 at the 8th grade in both mathematics and science. At the 4th grade, we place 7th out of 16 and 6th out of 14 in math and science, respectively. That is despite the fact that we spend more per pupil than every country that outperforms us, and indeed more than any of the 48 participating countries except Norway.

The U.S. is also getting plaudits for rising TIMSS math scores since 2003, though our performance in science seems to have stagnated. It is inevitable that advocates of the No Child Left Behind law will claim credit for the math gains, but let’s not be too hasty in going along. First of all, the PISA international test results released last year show declines in both mathematics and science scores since 2003, and the math decline is statistically significant. So TIMSS is not the only word on the issue. Moreover, the 8th grade gains in student scores that occurred on TIMSS between the late nineties and 2003 – before NCLB could have had an effect – are larger than those that have occurred since (4th grade TIMSS scores are not available for 1999). The same pattern is true of America’s own National Assessment of Educational Progress.

So we’ve thrown $100 billion or so at NCLB and, at best, performance has improved more slowly than before the law was passed. At worst, it has declined. The Obama administration should give these facts serious consideration in deciding what to do with the law.

Blagojevich: Business as Usual

Reading over the complaint against Illinois governor Rod Blagojevich (D) - which is highly entertaining, by the way - I’m struck not by the brazenness of his attempt to “sell” the Senate seat, but by how typical it is of the horse-trading done in politics.

Fawned over by lobbyists and staff, politicians tend to collapse together the public interest and their personal interests. It is the norm - not some outrageous deviation - to exchange political favors for help with attaining higher office, including campaign contributions. It’s only a small step from there to private emoluments.

Blagojevich may have crossed a legal line, and his foul language certainly sounds in corruption. (Didjya think that politicians don’t swear when they talk to their buddies?) But it’s a line politicians touch their toes to all the time.

Only if you pretend that politicians are selfless do you find Blagojevich’s horse-trading unusual.