McKiernan’s Out, McChrystal’s In

General David McKiernan, top American commander in Afghanistan, will be replaced by former commander of the Joint Special Operations Command, Lt. Gen. Stanley McChrystal.

According to the New York Times, Department of Defense officials said McKiernan had been removed primarily because “he had brought too conventional an approach to the challenge.”

Does a change at the top signal a shift in tactics? I would hope, but probably not.

In the past couple weeks U.S. air strikes have killed scores of innocent civilians. In response, White House National Security Adviser Gen. James L. Jones said the air strikes would continue.

By the day I’m growing more pessimistic about our ability to effect a better outcome in Afghanistan than what would exist in absence of our efforts. Every measure is taken to limit civilian casualties. But the accidental killing of civilians by U.S. air patrols fuels resentment against the presence of the U.S.-led coalition. The problem I see is simple: the collateral damage unleashed from air strikes make the Taliban appear to be a force against injustice and consequently undermine the very security Western forces are attempting to provide. Ergo, why remain?

In the “more of the same” war in Afghanistan, according to the LA Times, “The Pentagon also is considering a radical shift in deployment cycles, assigning key leaders and planners to Afghanistan for as long as five years.” (emphasis mine)

As my good friend and fellow libertarian Anthony Gregory says about Barack Obama versus George W. Bush: “Same big stick, just more soft-spoken.”

There Are Always Strings Attached…

Following up from my blog entry last week on Rep. Barney Frank’s (D, MA) efforts to reduce restrictions on Americans’ freedom to gamble online, it seems that the prospect of more tax revenue has made some folks see religion.

An article from Texas Insider has details on the political shenanigans needed to get this bill passed, including an associated bill introduced by Rep. Jim McDermott (D, WA) to tax (at a rate of 2%) the deposits into online gambling accounts. Apparently, that could provide up to $43 billion in tax revenue over 10 years. For the children.

Apparently we get our freedoms restored with a side-dish of tax.

As an aside: Note long-term opponent Rep. Bob Goodlatte’s (R, VA) non-sequitur on why allowing the Frank bill to pass is a bad idea:

Apparently, Rep. Frank believes that [Treasury Secretary] Timothy Geithner can do a better job at enforcing our nation’s criminal laws than the Department of Justice, which is scary considering [Geithner’s] track record on complying with the tax code,” he said.

(he is referring to the Frank bill’s proposal to shift responsibility for the licensing and regulation of online gambling companies to the Treasury)

HT: hero of the revolution Radley Balko.

The President’s Misguided Tax Hike on U.S. Companies Competing in World Markets

Bashing big business about “shipping job offshore” may be good politics, but the real-world evidence shows that Obama’s tax hike on American multinationals is spectacularly misguided. I would say it is so bad that it leaves me speechless, but I did manage to pontificate for almost nine minutes in this new video:

One of my goals is to make sure viewers actually understand an issue after watching, so the goal is education rather than just providing soundbites against a particular proposal. As always, feedback is appreciated.

About That Vision Thing…

Does the world need a “shared vision on food and agricultural trade policy”? So says World Trade Organization Director General Pascal Lamy:

Let me start by saying that food and agricultural trade policy does not operate in a vacuum. In other words, no matter how sophisticated our trade policies may be, if domestic policies do not themselves incentivize agriculture, and internalize negative social and environmental externalities, then we will always have a problem.

Here I question what exactly Lamy means by “incentivize”.  Does he mean “make sure we get incentives right”, or does he mean “provide positive incentives to agriculture”? The former probably is harmless if it means simply allowing market forces to work, the latter a potential opening for the types of subsidies and price supports that have done so much damage to agricultural trade policy. Ditto with his wish to “internalize negative social and environmental externalities”: on the face of it, this is a fairly inoffensive goal, and a positively noble one if he is referring to, say, the effects on poor farmers abroad stemming from rich country farm subsidies. But I can see all sorts of nefarious social policies flowing from that prescription if it gets into the wrong hands.

Lamy goes on to make sensible points about the effects of tax policy on agriculture, and makes this statement about the importance of free trade for food security:

To my mind, global integration allows us to think of efficiency beyond national boundaries. It allows us to score efficiency gains on a global scale by shifting agricultural production to where it can best take place. As I often say, if a country such as Egypt were to aim for self-sufficiency in agriculture, it would soon need more than one River Nile. Which basically means that global integration must also allow food, feed, and fibre to travel from countries where they are efficiently produced to countries where there is demand.

All necessary, if not sufficient, conditions for global food security, to be sure. But Lamy then turns to exactly what a global vision for agriculture might involve:

I believe that we could all agree on what the basic objectives are that we seek from our agricultural systems. We all want sufficient food, feed, fibre and some even want fuel. We want nutritious food and feed. We want safe food and feed. We want a decent and rising living standard for our farmers. We want food to be available and affordable for the consumer. We want agricultural production systems that are in tune with local culture and customs, and that respect the environment throughout a product’s entire life-cycle.

Hmm. I’m not sure about all that. For one thing, some of those goals seem potentially in conflict. United States sugar policy, for example, has shown us the results when consumers’ desire for “affordable” food conflicts with sugar farmers’ desire for a “decent and rising living standard” (hint: it’s not the consumers who make out like bandits). Similarly, it is at least conceivable that food grown “in tune with local culture and customs” might be more expensive, or make food less abundant, or even less safe. And if those goals can be in conflict within a country’s borders, I shudder to think what such an overburdened agenda could do to the already-struggling global trading system. At the extreme, a call for a “global vision” of agricultural trade policy could see the return of international commodity agreements and other supranational management nightmares of the mid-late 20th century.

On balance, the WTO has been a force for good in freeing agricultural trade. For sure, commodity markets are still very distorted, and the whole mercantilist basis of the WTO must be questioned. But by trying to harness the desire of exporters for more customers to counteract the pressure on governments to protect domestic industries, the WTO has done much good in the world. Pascal Lamy is right to encourage countries to stay on course with the Doha round of trade negotiations. I just hope that encouraging a “global vision” for agriculture, and pointing to vague notions of “social externalities,” doesn’t run against his stated purpose of freeing farm trade.

More on Cato’s work on agricultural trade policy here.

Patching up the Education Monopoly

The Eli and Edythe Broad and Bill and Melinda Gates foundations have sponsored a report, “Smart Options: Investing the Recovery Funds for Student Success,” on how to spend $100 billion of “stimulus money” on improving America’s schools, according to Jay Mathews in The Washington Post. Ideas include national standards, better teacher evaluations, special help for struggling students, and more.

But let’s try a thought experiment. Bill Gates made his money in software. Eli Broad made his money building houses. Imagine a slightly different universe, say one in which Henry Wallace and Al Gore had become president, and we had monopoly providers of both software and housing. How good do you think the software and the housing would be? And if the U.S. Department of Technology and the U.S. Department of Housing announced that they would be spending another $100 billion, what would happen?

minitelIt seems clear that the way to improve housing and software in that world would be to open the fields up to competition, or even to privatize them. A government monopoly provider of software would be lucky to have given us Minitel by now. And monopoly provision of housing was tried in much of the world during the 20th century, with poor results. So if we were afflicted with these albatrosses, surely we’d recognize that deregulation, competition, and privatization would produce better results by far.

So then why don’t we realize it when we’re afflicted with a virtual government monopoly on the provision of education? Why are zillions of smart people studying and debating how to improve the performance of a sluggish, stagnant, tax-funded government monopoly? Maybe we shouldn’t be so sure that we’d see the failure of the software or housing monopoly either. Whatever enterprise the government chooses to monopolize – and there’s really nothing inherent or inevitable about which enterprises that will be – will most likely become a massive bureaucratic undertaking, and we will find it difficult to imagine how the enterprise could be privately run.

But Bill and Melinda, Eli and Edythe, Jay, Barack – the evidence on monopoly vs. competitive provision of services is out there. To a great extent it’s the history of the 20th century. Check it out.

Rev. Joe Darby of the NAACP and I Discuss School Choice

Tomorrow morning, the Rev. Joe Darby of Charleston, South Carolina and I will kick off a dialogue about school choice. As South Carolina’s legislature debates an education tax credit bill, Joe and I will debate the merits of school choice right here at Cato-at-Liberty.org.

Joe is an eloquent, thoughtful guy. I expect it to be very interesting.

Who’s Blogging about Cato

Here’s a roundup of bloggers who are writing about Cato research and commentary:

Are you blogging about Cato, but not on the list? cmoody [at] cato.org (Drop us a line) and let us know!

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