What Use are Campaign Economists?

An irony of modern presidential campaigns is that they bring on board top tier economic advisors, but that doesn’t stop them from injecting economic nonsense into candidate speeches.  

Candidate Obama just added some skilled economists, but that didn’t prevent him from making ridiculous claims about recent economic policies in a speech yesterday. Take one Obama statement: “our president sacrificed investments in health care, and education, and energy and infrastructure on the altar of tax breaks for big corporations and wealthy CEOs.” Obama is wrong on every point in this remark.

Here are the facts from the federal budget looking at Bush’s first 7 years in office (FY2001 to FY2008):

  • Department of Health and Human Services spending up 67 percent in 7 years of Bush.
  • Department of Education spending up 92 percent in 7 years of Bush.
  • Department of Energy spending up 42 percent in 7 years of Bush.
  • Federal capital investment outlays up 35 percent for nondefense and 131 percent for defense in 7 years of Bush.
  • Federal corporate tax revenues up a stunning 128 percent in 7 years of Bush.

All these figures are available to the Obama campaign in the Federal Budget—Historical Tables. There is no reason for Obama and his advisors to make up nonsense statements about supposed spending cuts, when there are plenty actual failed economic policies that Bush could be criticized for.

Obama Should Learn from King Canute

Legendary tale of King Canute:

“King Canute (995-1035) ruler of England, Denmark and Norway, was surrounded by sycophants. One day, he ordered his courtiers to take him to the sea shore, where he challenged them, saying, ‘Do you believe that I can halt the sea?’ None disputed the fact, so Canute commanded the sea to cease its upwards march. But soon Canute’s feet were covered in water, showing that even he was unable to hold back the tide.”

Legendary tale of candidate Obama:

“I am absolutely certain that generations from now, we will be able to look back and tell our children that this was the moment when… the rise of the oceans began to slow and our planet began to heal.”

Seasteading and Dynamic Geography

Over at Ars Technica, I have an in-depth discussion of seasteading, an effort by a group of Silicon Valley libertarians to develop technology for living on the open oceans in a cost-effective manner. They argue that government is an industry with excessive barriers to entry, and they aim to change that by creating a turnkey solution for starting your own community.

History is littered with utopian projects, libertarian and otherwise, that fell far short of their lofty goals. At first glance, the Seasteading Institute looks like just another utopian scheme. But there are at least two reasons to think this one might accomplish more than its predecessors. First, recognizing that it would take many decades to develop a self-sufficient ocean metropolis, Friedman and his partners have chosen to focus largely on short-term engineering challenges. They want to build cheap, durable sea platforms that anyone can purchase. Second, they’ve raised half a million dollars from Peter Thiel, the libertarian entrepreneur who co-founded PayPal and is now a major investor in Facebook. Thiel’s backing will allow them to move beyond the extensive background work they’ve already done and begin the expensive task of actually designing and building their first prototype, which they hope to splash down in San Francisco Bay in the next few years.

Will this ultimately lead to the creation of libertarian metropolises in the open ocean? There are certainly lots of reasons to be skeptical. But there are also plenty of examples of technological change undermining existing hierarchies of authority. The invention of the printing press helped to undermine the authority of the Catholic church by democratizing access to knowledge. And in the 1960s, “pirate radio” ships, operating in international waters, helped to undermine many European states’ monopoly on radio broadcasting by beaming the latest pop tunes to eager European listeners. In this month’s Cato unbound, we’re talking about the ways that technological change is challenging traditional copyright law. Swedish copyright activist Rasmus Fleischer kicks things off arguing that advances in Internet connectivity and portable digital storage will make it effectively impossible for the authorities to control the dissemination of copyrighted works. My reaction to his essay will be up tomorrow.

Hence, policy changes are frequently the result of technological progress. Hierarchical institutions often exert control through the exploitation of technological limitations. The Catholic Church exploited the high costs of reproducing the written word; today’s copyright industries are built on the formerly-high costs of reproducing copyrighted works. By the same token, today’s governments owe much of their authority to the high costs of changing jurisdictions. The technology of seasteading may change that by allowing “dynamic geography,” a situation in which any part of society is free to exit and take their homes and businesses with them. It may take many decades for this vision to be realized, if it can be realized at all. But it’s fun to see someone at least giving it a shot.

North Carolina: REAL ID Implementation on Hold

North Carolina is not one of the states that has joined the REAL ID Rebellion. By all accounts, it was plodding along, getting ready to implement the federal government’s national ID mandate.

But now comes news that the changes North Carolina had planned are on hold. “ ‘The Real ID Act is pretty much at a standstill nationwide,’ said Marge Howell, a spokeswoman for the Division of Motor Vehicles,” according to one report:

As a means of complying with the federal Real ID Act, the state DMV had planned on implementing a requirement that people who apply for a new or renewed driver’s license start producing documentation showing the motorist’s proof of identity and legal address beginning Dec. 1. That has now been delayed.

Another change, set to begin on July 1, requires the DMV to mail a motorist’s license to a residential address instead of instantly issuing a license. Howell said that program won’t go into effect statewide at the beginning of July. Instead, the DMV plans to phase that program in.

Even the compliant states are getting the message that REAL ID is a non-starter.

I recently queried whether one of the largest companies producing driver’s licenses would continue to agitate for the national ID law or embrace a diverse, competitive identification and credentialing marketplace.

Gates vs. Fighters

The Secretary of Defense must read Cato-at-Liberty. I suggested Thursday that Robert Gates should break 25 years of fighter pilot rule over the Air Force when he picks Buzz Moseley’s replacement. And voila. General Norton Schwartz, who was head of US Transportation Command (the logistics center for the military, essentially) has experience as a C-130 (airlift) pilot and in Air Force Special Operations Command. He has even written about using AC-130 gunships to support urban combat operations.

This is the kind of guy the Army would pick to run the Air Force. The Air Force fighter leadership apparently wanted to elevate Gen. John Corley, commander of the Air Force’s Air Combat Command, a former F-15 guy, to the top spot. Not only did Gates not do that, he moved Schwartz’s deputy from Transcom, Lieutenant General William Fraser III, a three-star former bomber pilot, to Vice Chief of the Air Force.

Gates is slapping around the figher mafia that runs (ran?) the Air Force. The chances of F-22 procurement going beyond 183 (the Air Force, at least until today, wanted 381) just went down, although Congress and the next administration will have something to say about that. The China threat inflation coming from the Air Force should diminish. The Air Force’s commitment to supporting Army led counter-insurgency campaigns will increase. The cries that the Air Force is underfunded will soften.

Delegate Norton, Congressional Dems Set to Cut Educational Lifeline, Parents “Befuddled”

The Washington Post reports today that D.C. delegate Eleanor Holmes Norton is working on a plan to kill the voucher program that enables close to 2,000 children in the District to attend good private schools. Anticipating an expansion of a Democratic majority in Congress and possible takeover of the presidency, Norton believes the program will end next year.

Norton admitted that in her conversations with parents, “They looked completely befuddled” at learning that the voucher program might be killed. I’m sure those parents can’t understand why politicians want to eliminate a small program that lets some lucky students escape from DC’s failing, dilapidated, and often dangerous schools.

These parents don’t understand that the priority for many politicians is giving kickbacks to teachers unions, not the welfare of kids or taxpayers.

Studies consistently demonstrate that choice increases parental satisfaction, student achievement and saves money. As Andrew Coulson noted in a recent oped, the District spends more than $24,000, in contrast to the maximum $7,500 voucher, on each child and still can’t ensure a safe, let alone adequate, education.

“We have to protect the children, who are the truly innocent victims here,” explained voucher opponent Norton, apparently without irony.

Instead of conspiring to send nearly 2,000 children back to one of the worst public school systems in the country, Norton and other Democrats should keep the D.C. voucher program and expand school choice through other methods such as education tax credits. We need to put more power in the hands of parents instead of a corrupt and union-dominated school system.

Killing DC’s voucher program would be a cruel and indefensible exercise in special-interest pandering.