It’s Hard to Compete with ‘Free’

The Fordham Foundation has just released a new report documenting the closure of 1,300 Catholic schools since 1990 — shifting some 300,000 kids into the public sector at a cost to taxpayers of about $20 billion. 

It’s hard to compete when the other guy (read: state-run schools)  spends about twice as much per pupil but gives his service away for “free.”

A proper education tax credit program would level the financial playing field between government and independent schools, dramatically increasing parental choice and saving taxpayers a bundle in the process.

And wouldn’t it be nice if we gave parents the means to escape schools like this?

Florida Teachers vs. Poor Parents

As I blogged a couple of weeks ago, Florida’s largest public school employee union, the Florida Education Association, is threatening a lawsuit to kill that state’s scholarship program for poor kids. Why would they choose to go down this road, mined as it obviously is with the potential for bad publicity? 

I explain that today in an Orlando Sentinel op-ed, giving the FEA a little of the bad publicity it so richly deserves in the process.

Monetary Mercantilism

Chile’s Central Bank has finally decided to intervene in the local currency market in order to avoid a further appreciation of the peso against the U.S. dollar. In doing this, Chile joins a monetary policy trend that includes most Latin American countries, particularly Argentina, Bolivia, Peru, Colombia, Costa Rica and Guatemala.

Until recently, Chilean monetary policy was regarded as an example for all Latin America. Chile was mentioned frequently — especially by defenders of “monetary sovereignty” — as a model of how a Latin American country can have both a national currency and monetary stability.

However, alarm bells started ringing last year when inflation tripled to almost 8 percent, mainly because of an excessive increase in public spending by the government of Michelle Bachelet. Now, by deciding to abandon the historic policy of free floatation of the peso, Chile’s Central Bank further compromises this year inflation’s target.

Aiming for a cheaper peso will prove very expensive for Chileans.

Max Boot’s Moral Compass

Max Boot writes this today, discussing the competing currents of American foreign policy, militarized Wilsonianism and those who oppose it:

The opposing viewpoint—which denounces American “imperialism” and abjures the defense of liberty abroad—has an equally long history. It lists among its proponents not only modern-day neocon-bashers such as Michael Moore and Pat Buchanan, but also such illustrious predecessors as the “progressive” historians Charles Beard and William Appleman Williams and realpolitik thinkers like Hans Morgenthau and Walter Lippmann.

Does Boot want us to believe that–to take a particularly salient example–playing one Shi’a militia off the other amounts to “the defense of liberty abroad”? Maybe I don’t want to know the answer, since Boot has called the deranged Gen. Curtis LeMay “one of the ‘greatest peacemakers in modern history,’ a proper candidate for a Nobel Peace Prize” and gushed over how maybe the Philippines (200,000 civilians killed! torture!) could be a model for how to win in Iraq. So I for one will pass on taking my moral cues from Boot, thanks.

Dispatch from the ASIL Annual Conference II

This morning I attended two panels at the ongoing American Society of International Law Conference. The first was “The Politics of War Crimes Tribunals,” which refreshingly did not simply rehash the formation of the International Criminal Court but dealt with the meatier issues of how to decide whom to prosecute, what kind of justice to pursue, etc. The panelists, all academics who had played various roles associated with, for example, the Special Court for Sierra Leone, discussed precisely the issue that most interests me: how to draw the line between law and politics. If you overshoot and try to prosecute thousands of perpetrators of unspeakable crimes, spread across multiple countries, your political support will collapse. If you amnesty everyone, there is no justice. Tough decisions have to be made such that there is some justice, which is better than no justice.

One interesting anecdote from this first panel involved the quixotic attempt by Col. Luke Lea and a motley band of doughboys to capture Kaiser Wilhelm at the end of World War One. The panelist who told this story – which was relevant because the plan was to prosecute the Kaiser as a war criminal – misnamed Col. Lea as having been a Texan, when anyone worth his salt knows that it’s “Luke Lea of Tennessee.”

(Ok, ok, the only reason I knew this factoid was because when I interned for former Senator Bill Frist (R-TN) over a decade ago, I was charged with writing an essay on Lea as part of a project to document the lives of all Tennessee senators. Lea was a one-termer who, upon losing the Democratic nomination after the passage of the Seventeeth Amendment – direct election of senators – volunteered for the Great War.)

Who Wins the Tax Competition Debate?

The Wall Street Journal posted an online debate between yours truly and Raymond Baker of the Brookings Institution. We are supposed to decide which is worse: tax havens or high taxes. I began the debate by explaining:

Tax competition is a liberalizing force. When politicians worry that jobs and investment have the freedom to cross borders, their reflexive desire to overtax and overspend is at least somewhat curtailed. Tax havens play a valuable role in this process, and this helps explain why income tax rates have dropped by more than 25 percentage points since 1980 and corporate rates have fallen by more than 20 points. These reforms have greatly strengthened the global economy, improving living standards across the board and helping to lift hundreds of millions of people out of poverty. Efforts by bureaucracies such as the OECD to create a tax cartel – an “OPEC for politicians” – should be rejected.

In his contributions, Mr. Baker largely avoided any debate about tax competition and repeatedly asserted that tax havens were refuges for dirty money. I cited numerous sources that suggest otherwise. I then closed by arguing that: Because of tax havens and tax competition, the world today is much more prosperous and global poverty has been reduced. The OECD should not be allowed to disrupt the world economy by stifling competition and creating an “OPEC for politicians.” Every nation has the sovereign right to determine its own tax and privacy laws – and to control the taxation of economic activity inside its borders. Tax competition is good for America, good for the world, and good for freedom.

It will be interesting to see whether the comments in the reader forum will favor one side or the other.