Old Enough to Die for Your Country, Too Young for a Credit Card

While much of the debate around the so-called “Credit Cardholders’ Bill of Rights” has been on ending various card policies aimed at disguising different credit risks, one group of cardholders is certain to lose their right to credit under this bill: adults between the ages of 18 and 21.

Under the current Senate bill, the only way for someone under the age of 21 to get a credit card would be either:

1) they have a co-signer, such as their parent, sign for it, or

2) they maintain a job with sufficient income to cover any obligations arising from the credit card.

By contrast, neither of these requirements is put in place for student loans; there is the clear expectation that you pay those loans back in the future from your increased future income that results from going to college. While the purpose of a student loan is to offer one the means to get a higher education, the purpose of any form of credit is to borrow against your future earnings in order to enjoy some consumption today. Whether that consumption is in the form of textbooks or beer and pizza should be left up to the individual—we are talking about adults here—and not the state.

As with any legislation, there are likely to be substantial unintended consequences. Of the approximately 18 million students enrolled in U.S. colleges, some number of those will not want to give up their credit cards (maybe they value their beer and pizza) and will accordingly take what may be their only option to maintain that consumption: a job in addition to their studies. As with any choice in lift, this one comes with a trade-off. One of the primary factors related to whether one graduates from college is if one is holding a job while in college—the relationship being that the more hours a student works unrelated to classes, the less likely they are to finish college. Some students are going to take that trade-off. That means one impact of this bill will be that slightly fewer students will finish college. If we are ever to expect college students to start behaving as adults, we should start treating them as such, including allowing them to make their own credit decisions.

End the Drug War. Just Do It.

Obama’s new drug czar, Gil Kerlikowske, in an interview with the Wall Street Journal, says it is time to move away from the “war” rhetoric surrounding federal drug policy.  Since Kerlikowske has just assumed office, this is exactly the right thing to do – set a whole new tone from the militarized approach we have seen over the past 20-30 years. 

Drug abuse is a problem that must be dealt with, but we don’t need to send troops to Latin America, we don’t need former generals like Barry McCaffrey to oversee drug policy, and we don’t need police officers conducting raids on American homes with machine guns and  flash bang grenades.

The political climate on drug policy is shifting.  Republican governors like Arnold Schwarzenegger are calling for an open debate on legalizing marijuana.  New York is finally discarding its Rockefeller drug laws.  And Latin American leaders are urging the U.S. to reverse course.  Obama seems interested in a new direction but the appointment of a sensible law enforcement official like Kerlikowske and talk of “more treatment” is not enough.  We need more decisive action away from the criminalized approach to drug policy.  The time is right to just do it.

For Cato research on this subject, go here.

Haass: Defining ‘Success’ Down

Richard Haass’s op ed in today’s Post is worth a read. Sure, it amounts to a well-placed advertisement for his new book, War of Necessity, War of Choice. And it’s not like Haass, current president of the Council of Foreign Relations, and former director of policy planning at the State Department, lacks for exposure. But while I would quibble with his characterization of the first Gulf War as “necessary”, it is refreshing for a man so firmly fixed in the foreign policy establishment to focus not on the United States’ supposed capacity for refashioning the global order, but rather on the limits of our power.

He urges President Obama to resist the impulse to expand our objectives in Afghanistan, and should not dedicate far more resources to the effort if we appear to be falling short of a few modest goals. He wisely counsels that the United States is unlikely to convince Iran to forego nuclear enrichment or North Korea to give up its weapons, and we should therefore focus on the more essential and achievable tasks of intrusive inspections of Iran’s nuclear facilities and pressure on North Korea (in concert with China) to prevent material and technology from being diverted to others.

He concludes:

Some will argue that defining success down is defeatist. And certainly, one can imagine an Afghanistan or an Iraq that becomes a Jeffersonian democracy and an Iran or a North Korea that gets out of the nuclear business. But such outcomes are improbable at best and more likely fantasy. Moreover, far greater involvement and investment would still fail to bring them about.

The alternatives are outcomes that are good enough and commensurate with interests and costs. The moment calls for defining success down. The United States is stretched economically and militarily. Better partial success we can afford than expensive failures we cannot.

Les Gelb, CFR’s former president, makes similar arguments in his latest book, Power Rules.

Few people in Washington rise through the ranks by talking about what we can’t or shouldn’t do, which partly explains why the voices of restraint are almost always drowned out by the vocal few calling for action. (For more on this point, see Steve Walt’s recent commentary at FP.com and Justin Logan’s observations on this blog.)

At the end of the day, therefore, I’m not convinced that Haass or Gelb, or anyone else, can consistently prevail with their judicious counsel to not act. Haass was on the inside when the second Bush administration was spoiling for a fight with Saddam Hussein, and neither he nor Colin Powell was able to stop that disastrous war. (Haass told NPR’s Robert Siegel yesterday that he was only 60 percent opposed to the war, so it is not even clear that he tried that hard to stop it.)

As I explain in my book, The Power Problem: How American Military Dominance Makes Us Less Safe, Less Prosperous and Less Free, because even sensible people who are strongly opposed to foreign military intervention will often lose the intellectual battles within the executive branch, we should return to the Founders’ prescription that the war powers be controlled by the people, through the Congress, not the president. We also need to understand before we go to war how a particular military mission advances U.S. national security, and that our men and women in uniform have been given a clear and achievable objective.

If we were to get away from the dangerous and counterproductive notion that the United States is – and should forever be – the world’s policeman, we could maintain a much smaller military. It would be designed to defend vital U.S. interests, not to fight other people’s wars, and build other people’s countries. And this smaller, focused military would constrain the president’s propensity to do something, and make it easier for him to turn aside the interminable requests for U.S. assistance.

All states, even enormously powerful ones, need to make choices. Haass makes this point eloquently, and I welcome his important contribution to the debate.

White House Czar Calls for End to ‘War on Drugs’

This morning in The Wall Street Journal:

The Obama administration’s new drug czar says he wants to banish the idea that the U.S. is fighting “a war on drugs,” a move that would underscore a shift favoring treatment over incarceration in trying to reduce illicit drug use.

…Gil Kerlikowske, the new White House drug czar, signaled Wednesday his openness to rethinking the government’s approach to fighting drug use.

Mr. Kerlikowske’s comments are a signal that the Obama administration is set to follow a more moderate – and likely more controversial – stance on the nation’s drug problems.

The Obama administration is likely to deal with drugs as a matter of public health rather than criminal justice alone, with treatment’s role growing relative to incarceration, Mr. Kerlikowske said.

Well, that’s at least a modest step in the right direction. However, I want to see how policies change (if they do) under the Obama administration. A change in terminology won’t mean much if the authorities still routinely throw people in jail for violating drug laws.

As for the international war on drugs, everyone in the Washington area is welcome to join us this Friday on Capitol Hill to discuss the consequences of the war on drugs abroad.

Of Course, It Is the Banks’ Fault!

Congress is off on another crusade, to save Americans from credit cards.  People get into debt, run up big fees, generally feel abused, and complain to their elected officials.  Never mind the obvious convenience, which is why credit cards have become an indispensable part of American commerce.  Legislators plan on micro-managing the credit terms which may be offered across America.

Reports the New York Times:

“We like credit cards — they are valuable vehicles for many people,” said Senator Christopher J. Dodd, Democrat of Connecticut, the chairman of the Senate banking committee and author of the measure now being considered by the Senate. “It’s when these vehicles are being abused by the card issuers at the expense of the consumers that we must step in and change the rules.”

“Abused by the card issuers.”  Of course.  The very same card issuers who kidnapped people, forced consumers to apply for cards at gunpoint, and convinced merchants to refuse to accept checks or cash in order to force everyone to pull out “plastic.”  The poor helpless consumers who had nothing to do with the fact that they wandered amidst America’s cathedrals of consumption buying wiz-bang electronic goods, furniture, CDs, clothes, and more.  The stuff just magically showed up in their homes, with a charge being entered against them against their will.  It’s all the card issuers’ fault!

But then, Sen. Dodd’s assumption that consumers are not responsible for their actions fits his legislative style: no one is ever responsible for anything.  Least of all the residents of Capitol Hill.