John McCain: The Good, the Bad, and the Ugly

With his victory in Florida, Sen. John McCain has become the clear front runner for the Republican nomination. It’s worthwhile, therefore, to take a closer look at what kind of president he might be.

The Good: While Rush Limbaugh and Sean Hannity sometimes portray McCain as a virtual clone of Ted Kennedy, the fact is that he is a true fiscal conservative—certainly more of a fiscal conservative than, say, Mitt Romney. He is well known as an opponent of earmarks and pork barrel spending. But perhaps more importantly, he has long been an advocate of entitlement reform. He was early an ardent support of personal accounts for Social Security, and has pushed for serious Medicare reform, including means-testing. Almost alone among Republicans, he opposed the disastrous Medicare prescription drug benefit.

He has offered the best health care reform plan of any of the candidates. While Mitt Romney has embraced the basic tenants of HillaryCare, McCain would change the tax code to equalize the treatment between employer-provided and individually-purchased health insurance. This is a vital step in moving away from our employment-based health care system toward a more consumer-oriented system. And, he would allow the purchase of low-cost insurance across state lines, avoiding regulation and mandates.

During his time in the Senate, he has never voted for a tax increase. While he has taken much heat for voting against the Bush tax cuts, he now calls for making those tax cuts permanent (although he would retain a vestige of the estate tax at a reduced rate and increased exemption). And, McCain is right that cutting taxes has too often become an excuse for republicans to avoid the hard task of cutting spending. Cutting taxes reduces the pain of government spending (at least for now), allowing Congress to avoid difficult choices. While taxes need to be cut—and McCain supports a number of tax cuts including reductions in the business tax rates and capital gains taxes—future tax cuts should be linked with spending cuts. As I argue in my book, Leviathan on the Right, it’s the size of government, stupid.

He is a strong and unapologetic free trader.

The Bad: John McCain frequently makes Dr. Strangelove look like a peacenik. Its not just his desire to remain in Iraq “for a hundred years.” It’s his bellicosity toward every enemy and perceived enemy from Iran to North Korea. He’s a true believer in the neoconservative goal of remaking the world to fit our desires and beliefs. At best on foreign policy he would be a competent Bush. At worst, he appears a recipe for perpetual conflict.

On domestic policy, he has shown a disturbing predilection for elevating every personal pet peeve, from steroids in baseball to airplane service quality, to a federal issue. And, he has embraced heavily regulatory environmental policies and compulsory national service. Like George W. Bush, he tends to support federal power over federalism, executive authority over legislative, and generally leans toward the imperial presidency.

The Ugly: John McCain appears to have little more than contempt for the First Amendment and free speech generally. He is the principal author of a campaign finance bill that severely restricts political speech. Not content with those restrictions on political speech, he has continually sought to expand regulation to other groups. He has said that he “would rather have a clean government than one where, quote, First Amendment rights are being respected, that has become corrupt. If I had my choice, I’d rather have the clean government.” Any candidate who believes that respect for First amendment rights needs to be qualified by “quote,” raises serious concerns. Moreover, his general attitude appears to be that criticism of the government, the war, and in particular himself, is somehow unpatriotic.

Most worrisome of all appears to be McCain’s basic philosophy, which is unapologetically statist, as Matt Welch points out in his new book McCain: The Myth of a Maverick. McCain once said “each and every one of us has a duty to serve a cause greater than our own self-interest.” McCain believes that cause to be the good of the collective, often defined as the nation or the national community.

For believers in individual liberty and limited government, it’s a decidedly mixed bag. But, then again, aren’t they all?

Why Congress Shouldn’t Panic about Eavesdropping

Rep. Rush Holt (D-NJ) has been a real leader in the fight to restore meaningful judicial oversight of domestic intelligence gathering activities. When the Democratic leadership unveiled its initial FISA reform proposal last fall, Rep. Holt felt the legislation had inadequate judicial safeguards and introduced an alternative bill with stronger judicial oversight. Holt successfully persuaded the Democratic leadership to make key changes to the legislation which became the FISA reform bill that ultimately passed the House in November.

Yesterday, Rep. Holt gave a great speech on the House floor urging his colleagues not to succumb to the administration’s scare tactics:

The PAA allows the President to conduct surveillance for virtually any reason with absolutely no oversight by a court, which means the administration’s surveillance activities don’t have a meet an independent judicial standard for appropriateness. It has been demonstrated that when officials must establish before a court that they have reason to intercept communications, we get better intelligence than through indiscriminate collection and fishing expeditions.

Passing this extension, rather than letting the PAA expire, achieves nothing from an operational point of view. This is a political calculation intended to facilitate our negotiations with the Senate and the White House. I disagree—this would not improve our negotiating position. If the PAA expires, all current surveillance orders issued under its authority will continue in effect until they expire. It’s also important to note that any existing PAA orders that continue in effect after the act’s expiration date are general enough to allow any necessary surveillance activity that may be required…

The House passed a good FISA modernization bill late last year (the RESTORE Act), and any House-Senate conference discussion on how to modernize FISA should start with that bill. In the meantime, our intelligence services will continue have the tools they need to protect us.

Allow me to expand a bit on Holt’s argument. The Protect America Act states that “the Director of National Intelligence and the Attorney General, may for periods of up to one year authorize the acquisition of foreign intelligence information.” And the authorization “is not required to identify the specific facilities, places, premises, or property at which the acquisition of foreign intelligence information will be directed.” This suggests that a single “authorization” is not limited to a particular investigation or target, but can be used to approve general, open-ended wiretapping programs such as the one uncovered by the New York Times in 2005.

Most likely, the administration has issued “authorizations” for its various warrantless surveillance programs. These authorizations will not expire when the Protect America Act sunsets; they will continue in force for a year, which means that the earliest any of them would expire is next August. And if, after the Protect America Act sunsets, a surveillance need comes up that’s not covered by an existing “authorization,” the government will still have the ability to obtain a warrant the old-fashioned way through the original FISA provisions. Indeed, FISA has always permitted the government to begin eavesdropping immediately and request an emergency warrant up to 72 hours after the fact.

In short, nothing catastrophic will happen if Congress doesn’t enact new legislation this week. The intelligence community will have all the authority it needs to continue its surveillance of suspected terrorists. Yet the president is doing his best to create an atmosphere of panic because he believes that will help him stampede Congress into approving an unnecessarily broad expansion of executive power. Congress should keep its wits about it and take the time it needs to craft balanced legislation that gives the intelligence community the flexibility it needs while preserving the principle of judicial oversight and rejecting demands for retroactive immunity for lawbreaking telecom companies.

Hillary’s Choices

When a politician has a vulnerability, there are different ways to deal with it. You can ignore it, stonewall questions, pretend it isn’t there. You can joke about it, as Ronald Reagan did with his age. Or you can embrace it, make it a virtue. In his early campaigns the rumpled and overweight Barney Frank (who has long since slimmed down and bought better suits) campaigned on the slogan “Neatness isn’t everything. Re-elect Barney.”

Hillary Clinton seems to have adopted the Barney Frank approach on the issue of corruption. Since 1991 or thereabouts, ethical questions have swirled around the Clintons–Whitewater, commodity trading, billing records, small-time grifters in the Cabinet, Travel Office firings, campaign fundraising, right on up to the midnight pardons as they left the White House. So she might have tried to run a squeaky-clean campaign to make people forget all that ancient history.

Tuesday night in Florida, however, it became pretty clear that that wouldn’t be her strategy. At her Florida victory speech, she was introduced by one of her national campaign co-chairs, Rep. Alcee Hastings. Back in 1988, Hastings was a federal judge. He was impeached by the House of Representatives on charges related to bribery and was removed by the Senate. Rep. John Conyers, now chairman of the Judiciary Committee, was one of the House impeachment managers. The House vote was 413 to 3.

On January 20, 2001, Bill Clinton pardoned William Borders, who was convicted and jailed in connection with the bribery of Hastings.

It looks like the Clintons are not embarrassed to be associated with other politicians who have been accused–and impeached–and indeed actually removed from office for unethical behavior. “Ethics isn’t everything. Bring back the Clintons.”

State of the Earmarks

Last night’s State of the Union address didn’t contain much in the way of new policy proposals. As I note in a podcast (Subscribe!), this is largely a reflection of President Bush’s limited political capital because of his lame duck status, low approval ratings, and the Democratic majority in Congress.

But one issue Bush did indicate he will tackle is the rampant earmarking on Capitol Hill. Bush said he would take a couple actions on this front – and while these might be modest steps in the right direction, the results will be far from earth shattering.

First, Bush will “issue an Executive Order that directs Federal agencies to ignore any future earmark that is not voted on by the Congress.” This is good step and one that fiscal conservatives on Capitol Hill have been urging for years. The President can ignore certain earmarks because Congressional appropriators routinely exclude them from the legislative text of spending bills. Instead they “airdrop” many earmarks into conference reports at the last minute. These reports are not technically part of the law, but serve as accompanying documents to inform the Executive Branch of Congress’s intentions. Appropriators do this to circumvent transparency measures and make questionable earmarks immune to points of order or striking amendments by critical members. Because the Executive branch has always played along, it has never been necessary for Congress to act otherwise.

Until now.

With the new Executive Order in place, Congress will presumably be forced to include earmarks in legislative text rather than putting them in nonbinding conference reports. This will likely increase transparency to some degree, but it’s unlikely to have a significant impact on earmarks beyond that. Enough support resides in Congress to continue to earmark funds and easily defeat procedural hurdles along the way. Furthermore, Bush missed a huge opportunity here. He could have applied the Executive Order to the current 2008 fiscal year and wiped out thousands of earmarks in the process.

Bush also indicated that he would veto appropriations bills that do not reduce the number or cost of earmarks by 50 percent. This might encourage appropriators to cut earmarks per the president’s request. But there is a danger here – rather than shooting for a significant reduction in earmarks, Congressional leaders could instead dole out more money for members’ pet projects in order to build a vested voting block large enough to override a veto. In terms of passing the annual spending bills, this could be an easier path for Congress to follow, as most spending bills already pass with large majorities. The result could be a net increase in earmarks.

Still, President Bush has made a good faith effort toward improving the earmarking process. And by discussing earmarks during his final State of the Union address, he brought a national spotlight to the issue. But few significant improvements will occur until members of Congress stop coveting earmarks and voters stop returning earmarkers to Congress.

My Least Favorite False Note on Trade in Last Night’s SOTU

My colleague Dan Griswold has a post below about some of the good things President Bush said in his State of the Union address last night (transcript here). While the President deserves praise for the remarks he made about the importance of trade to the American economy, he made much of the importance of exports and of opening markets overseas, with only a cursory glance at the benefits of imports.

That mercantilist rhetoric, in my opinion and in the opinion of my colleague Brink Lindsey, has boxed the administration and other lawmakers into a corner: people now erroneously assume that if the exports fail to materialize, or if the trade deficit worsens, then the trade policies have been a failure. The present skepticism about trade deals (even allowing for the fact we are in fully-fledged campaign mode) is a direct consequence of that flawed thinking.

Putting aside my ranting about the general state of public discourse about trade, though, there was one part of the SOTU address that particularly struck me as misguided. In making the case for trade deals, President Bush talked about the negative effects of trade liberalization on some workers and made a pitch for renewing trade adjustment assistance:

for some Americans, trade can mean losing a job, and the federal government has a responsibility to help.

Wrong.

Laffer Curve Video

Working in Washington can be very exasperating, and few issues are as frustrating as the Laffer Curve. Even market-friendly lawmakers frequently misinterpret the relationship between tax rates, taxable income, and tax revenue. The other 90 percent of politicians are even worse. Using straw-man arguments, they defend a revenue-estimating system that is based on the absurd notion that tax policy never has any impact on economic performance. I’ve complained vociferously (see here, here, and here), but that hasn’t worked.

It’s time to try something new. Regular readers of this blog may have seen the videos I narrated on tax competition and the corporate income tax. These videos, produced by the Center for Freedom and Prosperity, will never compete with Pamela Anderson, but they seem to get a decent amount of traffic by public-policy standards. So the Center has now released a video on the Laffer Curve with yours truly (a.k.a., the George Clooney of the free market movement) again serving as narrator. Indeed, this video is the first of a three-part series.

I sent the video to Art Laffer, who was kind enough to say, “This video is a great common-sense tutorial that shows the real relationship between tax rates, taxable income, and tax revenue. I hope it is widely viewed so that more people understand the need for pro-growth tax policy.” But I also want negative feedback. As in previous cases, I would welcome suggestions on how to make these videos more effective. Needless to say, feel free to share all of them with your friends and colleagues.

The Need for Judicial Oversight of Domestic Intelligence Gathering

I’m always hesitant to disagree with a fellow Cato scholar, especially one with a resume as impressive as Roger Pilon’s. But I thought Roger’s op-ed in the Wall Street Journal yesterday on the FISA debate missed a couple of important points.

Let me start with a couple of points on which everyone in the FISA debate agrees. First, no one disputes that the president has the authority to conduct purely foreign intelligence-gathering without court oversight. And as Ryan Singel has ably documented purely foreign eavesdropping has always been unregulated by FISA. If the NSA wants to splice into a fiber optics cable off the coast Great Britain, bribe a Syrian telephone employee for access to the telephone network, or install eavesdropping equipment on every cell phone tower in Iraq, FISA has nothing to say on the subject.

Second, virtually everyone agrees that changes are needed to allow the interception of foreign-to-foreign communications as they pass through infrastructure in the United States without judicial interference. Indeed, the Democratic House passed legislation to that effect back in October. We would not be having this debate today if the president had not threatened to veto that legislation.

The dispute is over what safeguards are appropriate to ensure that the intelligence community’s surveillance activities here in the United States are limited to genuine foreign intelligence. Roger’s position appears to be that neither the courts nor Congress may place any restrictions on domestic surveillance activities that the president declares to be related to foreign intelligence gathering. But that’s not good enough. Without judicial oversight, there is no way to know if the executive branch is properly limiting its activities to spies and terrorists, or if they’ve begun to invade the privacy of petty criminals or even law-abiding individuals. This is no hypothetical scenario. The FBI conducted extensive surveillance of Martin Luther King Jr. and other civil rights and anti-war leaders in the 1960s and 1970s, which was one of the reasons Congress enacted new safeguards in the first place.

The White House complains that the process for obtaining permission from the Foreign Intelligence Surveillance Court is too burdensome. But as our own Mark Moller has explained, most of the paperwork burden that the White House now complains about so bitterly was created by the administration’s own procedures for approving FISA applications. The paperwork required by FISA itself was fairly light. And not only did the Foreign Intelligence Surveillance Court reportedly almost never turn down an eavesdropping application, but the law also included an emergency wiretapping provision that allowed intelligence officials to wiretap first and then get a warrant afterwards.

In short, FISA gave the intelligence community plenty of flexibility to perform the domestic wiretaps they needed to keep Americans safe. But crucially, the government had to tell the court who it was spying on, so that the court could verify that the law was being followed. That’s an important safeguard that ensures that the president doesn’t exceed his constitutional authority and encroach on the privacy of law-abiding citizens. The Protect America Act severely crippled that protection, and it would be a serious mistake for Congress to make the damage permanent.