Lies, Damn Lies, Statistics, and a Media Happy to Abuse Them

The Wall Street Journal reports ($) today that support for free trade is fading among Americans who are likely to vote Republican.  Perhaps that’s true.  It certainly wouldn’t be surprising given the way most Americans are misled by their political representatives and the mainstream media about how to measure trade’s impact on the economy.

But something really smells about today’s lead article in the WSJ.  The WSJ/NBC News poll upon which the article is based simply doesn’t support the author’s conclusions.  In fact, the article is misleading in ways I find inexcusable for a newspaper of that caliber.   If you weren’t already, you should be highly skeptical of polling results (at least as reported second hand).

The third paragraph in the article reads: “Six in 10 Republicans in the poll agreed with a statement that free trade has been bad for the U.S. and said they would agree with a Republican candidate who favored tougher regulations to limit foreign imports.”  Next to that paragraph is a graphic box with a bar chart showing responses to the question: “Is foreign trade good or bad for the U.S. economy?”  The “Good” bar showed 32%; the “Bad” bar showed 59%.

Here’s the first problem.  That question (“Is foreign trade good or bad for the U.S. economy?”) was not asked in the poll.  The second problem: no questions were asked about whether the respondents would agree with a Republican candidate who favors tougher regulations to limit foreign imports.  But that didn’t stop the author from reporting that phantom result in paragraph three.

Here is a link to the subject WSJ/NBC poll.  Question 10 is the only question about trade, which gives two statements and asks the respondent to reveal which statement comes closer to his/her point of view.

Statement A: “Foreign trade has been good for the U.S. economy, because demand for U.S. products abroad has resulted in economic growth and jobs for Americans here at home and provided more choices for consumers.” (32% of Republicans agree)

Statement B: “Foreign trade has been bad for the U.S. economy, because imports from abroad have reduced U.S. demand for American-made goods, cost jobs here at home, and produced potentially unsafe products.” (59% of Republicans agree)

From these results, John Harwood concludes that “six in 10 Republicans in the poll agreed with a statement that free trade has been bad for the U.S. and said they would agree with a Republican candidate who favored tougher regulations to limit foreign imports.”

But as you can see, there is a clear bias in the manner of phrasing the questions.  You’re not agreeing that foreign trade is good or bad, but that it’s good or bad because… And respondents are more likely to be familiar with one of the offered consequences of trade.  Certainly, the issue of “potentially unsafe products” is fresh on our minds, thus respondents are basically escorted to that answer.

What bugs me most about this is that the competing statements: foreign trade has been good for the U.S. economy vs. foreign trade has been bad for the U.S. economy would have been perfectly objective phraseology.  Why introduce subjective perspectives?

That a professional polling agency would introduce such obvious bias into its polls and a major newspaper would ignore the obvious problems with the results is troubling.  For all we know, Ron Paul and Mike Gravel are the leading candidates for their respective parties’ nominations.

CORRECTION: The poll did ask about a Republican candidate who favored tougher regulation. See here.

Clinton’s $5,000 Baby Giveaway

In a speech last week, Senator Hillary Clinton proposed giving $5,000 (of your money) to every baby born in America in the form of a government-controlled savings account. In a speech last year, Clinton proposed a $500 baby savings account, so the cost is rising as we get closer to the election.

Clinton’s comments had roots in ideas proposed by both conservative and liberal think tanks and politicians. That’s not surprising, because both liberals and conservatives inside the beltway specialize in top-down government planning schemes. The liberal New America Foundation has a plan for a $6,000 baby giveaway. Conservative plans are discussed here.

Here are seven problems I see with baby giveaway plans:

1) Cost. Clinton’s plan would cost about $20 billion annually, but would be higher if added private savings were matched by further government subsidies. The money would come from higher taxes, causing damage to the private economy on the order of $2 for every $1 extracted (as Martin Feldstein estimated).   

2) Lobbying for Expansion. Suppose Clinton’s plan passed and would begin January 1, 2010. Do you think that parents of kids born in 2009 or 2008 would be happy that their neighbors were getting $5,000 giveaways and they weren’t? I don’t think so. I think lobby groups would quickly get Congress to expand the benefits to tens of millions of existing kids.

3) Cookie Jar Problem. Clinton suggested that when kids turned 18, they could use the money for college, buying a home, starting a business, or saving for retirement. But don’t you think that a $5,000 per-child cookie jar would be tempting for families to raid early? Interest groups would help them by lobbying to expand the accounts to cover: baby formula expenses, kids’ health costs, children’s clothes, kid’s school and tutoring costs, family emergencies, and so on. 

4)  Bureaucracy. All these exceptions would require hundreds of pages of regulations and a huge bureaucracy to administer. And we would also need a huge enforcement bureaucracy because with the government handing out $5,000 to anyone who mailed in a birth certificate, the temptation for fraud would be large.

5) Not savings. Giving people $5,000 is not savings. Savings involves individuals sacrificing current consumption for greater future security and income. There is no sacrifice here except by the taxpayers who have their own income and savings swiped by the government in higher taxes. 

6) Increased Consumption. Proponents of these savings plans claim that giving people money in freebie savings accounts will encourage them to save more on their own. Maybe. But the opposite would also occur. Parents would increase their own consumption rather than saving for their kids’ college costs because they would be counting on the government account. And kids reaching 18 would increase their own consumption because the government has their home downpayment covered. Savings is about frugality, but these accounts would encourage the opposite.

7) Generational Issues. The current Social Security and Medicare systems create a huge and involuntary transfer from young people to old people. Senator Clinton does not favor cutting these programs, while her new baby proposal would create a new program to take from older people (who are paying taxes) to give to young people. Clinton thus favors different programs that work exactly against each other.

Rather than having multiple government transfer programs working at cross-purposes, politicians might try simply cutting benefits and scaling down the fiscal war of all against all.

To boost savings, we should eliminate current government tax hurdles through universal, all-purpose, tax-free savings accounts

While money to fund baby accounts doesn’t grow on trees, crackpot schemes do in the fertile ground of federal election campaigns.

Advantage: Friedman!

The San Diego Union-Tribune’s Chris Reed got a chance to chat with Drug Czar John Walters recently.   Reed asked Walters about “Milton Friedman’s critique of the drug war, noting the evidence that the drug war – by making popular intoxicants illegal and available only on a highly lucrative black market – was responsible for lots of crimes beyond buying and selling, and that it had led to police corruption, among many other unintended consequences….”  Walters replied that Friedman’s critique was “untrue – demonstrably untrue.”  On the Union-Tribune’s weblog, you can get the details on Walters’ answer and whether he demonstrated that Friedman was wrong.  Reed, for one, found himself utterly underwhelmed by Walters’ logic.

For some of Cato’s work on the drug war, go here.  

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Which Part of “Not Green Box” Does the USDA Not Understand?

After a long wait, the United States finally notified the other members of the World Trade Organization of its spending on agricultural programs today. Although timely notification is supposedly a key requirement (and benefit) of the WTO, the U.S. had left members in the dark as to the true nature and extent of its farm subsidies since 2004, and that notification covered only the years up to 2001.

Today’s notification asserts that U.S. spending on so-called “Amber-box” domestic support (that which is linked to production and/or prices of agricultural commodities, and thus is the most market-distorting) was well below its limit of $19.1 billion in every year between 2002-2005 (the period covered by the latest notification). However, sources tell me that the administration admitted in a telephone press conference today that direct payments were classified as “green box” (spending which is at most minimally trade-distorting and therefore not subject to reduction commitments) in their calculations, in direct contravention of a 2005 WTO Appellate Body ruling on U.S. Cotton programs, which stated (at para. 342) “[P]roduction flexibility contract payments and direct payments … are not green box measures exempt from the reduction commitments by virtue of Annex 2 of the Agreement on Agriculture.” (my emphasis)

Seems pretty clear to me.

In other words, if direct payments are properly classified as amber box measures, the United States’ spending might look very different, and may not be below the legal ceiling after all, especially in years 2004 and 2005 (see more here). Members of Congress currently writing a new farm bill might want to keep the threat of WTO litigation (including pending challenges by Canada and Brazil) in mind.

President Wiretap

Along with the usual bills and flyers for bargain pizzas cluttering my mailbox yesterday was an envelope screaming:

SENATOR “WIRETAP”
what she could teach President Bush about serious snooping

I open it up to find a letter from Bill Buckley, using rather more underlining and fewer 11-syllable words than one usually associates with National Review’s founder.  It’s a direct mail pitch for the magazine, and in it I learn what the envelope’s shouting about.  It seems that Senator Clinton “twice employed Tony Pellicano, the Hollywood-based ex-con famous for using wiretaps, hand grenades, and plastic explosives in his, ah ‘inquiries.‘ “ 

I stopped following Clinton scandals after Bill Clinton left office, so I don’t know the story NR’s referring to, but it sure sounds disturbing.   And remember the Travel Office Scandal?  (I do, sort of).  Hillary really sounds like the sort of person you wouldn’t want to grant unlimited wiretap authority for anything she chooses to label “national security.”  Tough, says NR legal guru Andrew McCarthy (along with virtually everyone else who’s written about FISA for the magazine):

The president’s constitutional authority is inviolable — it cannot be reduced by mere legislation. When Congress passes a statute, like FISA, that purports to reduce the president’s constitutional authority, it is Congress, not the president, that is trampling the rule of law. A president who ignores such a statute is not a law-breaker; he is a defender of the highest law.

Judging by fundraising and polls, “Senator Wiretap” may well succeed GWB as “defender of the highest law.”  And then we’ll see if NR’s right about her teaching President Bush a thing or two about “serious snooping.”  

I feel like there’s a lesson in here somewhere, but I’m too distracted by Ted Kennedy jokes to figure it out. 

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The Political Possibility Delusion

Today the Thomas B. Fordham Foundation – a neo-con education think tank – released The Proficiency Illusion, a report detailing how low many states have set their “proficiency” standards under the No Child Left Behind Act. As discovered before, Fordham finds that many states set “proficiency” at surface-scraping levels, most likely in an effort to avoid sanctions under the law, or even more likely, just so their leaders can continue to tell their citizens “don’t worry, everything’s fine.”

Yesterday, I wrote about Diane Ravitch’s assault on NCLB in the New York Times, and took major issue with only one thing that she called for: national standards. Well, the Fordham folks make the same proposal, suggesting that it’s insane that we have no, single, curricular standard:

First, it’s crazy not to have some form of national standards for educational achievement—stable, reliable, cumulative, and comparable. That doesn’t mean Uncle Sam should set them, but if Uncle Sam is going to push successfully for standards-based reform he cannot avoid the responsibility of ensuring that they get set.

Now, forget for a second that the Fordham folks are saying that Uncle Sam needn’t set national standards but that it should set them all the same. What’s more important is that Fordham fails to address the same unavoidable problem that Ravitch missed: As long as government controls education, political forces will ensure that standards stay low and easy to meet. It is, simply, the absolutely inescapable conclusion one reaches after examining the history of public schooling generally, and the 40-plus years of federal involvement. Indeed, the No Child Left Behind Act and consistently bankrupt state standards prove this beyond a doubt, yet some conservatives still push for national standards, ignoring political reality and forgetting all the progressive educator, teacher union, and other special interest domination of education conservatives have been complaining about for decades.

The history of American education proves one thing: When government runs education, education works for the people in government, not parents and children. That’s why any national standards adopted by government – whether Uncle Sam or some consortium of states – are doomed to failure, and why the only way to get high standards – and critical competition and innovation to boot – is universal school choice.

It’s time for big government conservatives to accept political reality, forget about hopeless national standards, and put all their energy into giving parents – not politicians – the real power in education.  

More Reckless Raids?

Today’s NYT reports on reckless pre-dawn raids by immigration officials in New York. Excerpt:

“These were like dragnets being cast over entire houses,” said Nadia Marin-Molina, director of the Workplace Project, an immigrant advocacy organization in Hempstead that has gathered many of the complaints.

The complaints echo a federal lawsuit filed last month in Manhattan contending that immigration agents unlawfully force their way into the homes of Latino families in violation of the Fourth Amendment’s protection from unreasonable searches.

“We have been inundated with calls,” said Cesar Perales, director of the Puerto Rican Legal Defense and Education Fund, which filed the lawsuit. “People are terrified by these indiscriminate raids.”

It is a familiar tale of agents bursting into homes when the occupants are asleep and without having done sufficient investigative work in advance of the raid.  Such tactics produce unnecessary violence.  Sometimes the residents, understandably, think their home is being invaded by criminals.