50 Years On, Some Common Sense

Steve Clemons posts a heartening little video of Bush père’s National Security Adviser Brent Scowcroft responding to Steve’s question “What do you think about Cuba?” It’s a rare occasion for foreign policy folks to take heart and ponder whether the forces of reality may not be making progress on some issues, at least:

More common sense on Cuba here.

Measuring the Cost of E-Verify Red Tape

A recent story in the Arizona Republic describes the rising practice of using “registered agents” to take care of the paperwork associated with the E-Verify system, which is mandatory for employers in Arizona. Registered agents know how to navigate this system, which requires employers to submit information about their new hires to the federal government for an immigration-status background check. Registered agents are there to step in and reap the rewards when employers throw up their hands.

The story reports that registered agents charge from $7.50 to $10.00 per new hire. There are about 50,000,000 new hires per year in the country (according to Labor Department statistics), and let’s assume that average employer is a little more efficient than those who use a registered agent - so make it $5.00 per new hire. That’s $250,000,000 per year, just on basic administration of the E-Verify system.

There are plenty of other costs to electronic employment elgibility verification, which I wrote about in my recent paper, “Franz Kafka’s Solution to Illegal Immigration.”

At a recent hearing, Representative Ken Calvert (R-CA) reportedly said, “There are certain interests that simply do not want employment verification.” He was referring to an internecine fight with a human resources group. But I found in my paper that “successful internal enforcement of federal immigration law requires an overweening, unworkable, and unacceptable identity system.”

Freedom-loving Americans do not want employment verification. They think it’s doubly or triply foolish to spend taxpayer dollars and burn employers’ time on policies that reduce our economic growth.

Markets Beat Government on Medical Errors

Last year, the federal Medicare program announced that – after 40 years of financially rewarding providers who harm patients – it would no longer pay the added costs of treating patients who fell victim to a list of medical errors known as “never events.”  In other words, the providers – doctors, hospitals – will have to eat the costs of their own mistakes. 

As they often do, private health insurance companies are following Medicare’s lead.  WellPoint, Cigna, and other fee-for-service plans have announced that they too will stop paying the added costs that come from “never events.”

In the race to improve health care quality, is government beating the market?  Hardly.

As noted health economist Alain Enthoven and I explain in a recent oped, the market long ago developed payment mechanisms that punish medical errors:

If anything, government prevents markets from improving patient safety. A raft of government interventions favor fee-for-service medicine and inhibit competition by plans with greater incentives to reduce errors. Medicare, the nation’s largest purchaser of medical services, is almost entirely fee-for-service. Federal and state tax laws give larger tax breaks to people or groups that choose more costly care, and favor employer-based coverage, which usually denies workers the ability to choose their health plan.

Government regulation of health insurance and medical professionals further inhibit competition by such plans.

If you want to know why medicine isn’t better, cheaper, and safer, look no further than your own government.

Hard Work, Culture, and Private Education

When it comes to international academic assessments, especially in math and science, a few Asian countries regularly kick world posterior. Many observers chalk this up to these countries having national curricula, but this seems a specious conclusion given that most of the countries that do worse than Asian nations—and sometimes even worse than the U.S.—have national curricula, too.

A couple of additional—and quite likely more accurate—potential secrets of Asian success are touched on in a Saturday Washington Post article about South Korea:

South Koreans are working up a lather over working too much.

They put in far more time on the job than citizens of any other free-market democracy. Compared to Americans, they average 560 more hours at work a year – the equivalent of 70 more eight-hour days. And that is down significantly from the go-go 1990s.

In the OECD, they rank second to last in leisure spending, first in suicide and last in bearing children.

Despite the dearth of children, South Korea leads the OECD in per capita spending on private education, which often includes home tutors, after-school cram sessions and intensive English-language courses.

South Koreans, it seems, rely not primarily on government schooling as we do, but abundant private options, including tutoring companies that appear to be almost ubiquitous in many Asian nations. Indeed, in 2002 Education Week reported that in Japan “more than 50,000 private cram schools are taking in some $12 billion a year by some estimates.”

The massive consumption of private education is not the only likely explanation for outstanding Asian academic performance. So too is the culture that drives that consumption: As the Post highlights, Koreans put more emphasis on work than the citizens of any other industrialized nation. Of course, that appears to be a double-edged sword, probably yielding great testing outcomes but, as the suicide and income data in the article hint, not necessarily outsized success in life—or happiness. And while national academic standards and tests don’t likely create academic success, they could very well exacerbate the ugly side of Korean culture, taking an already work-obsessed mindset and forcing it on those students and families who might find happiness—and long-term success—in other ways.

L-1: The Technology Company in Your Pocket

Inspired by the promotional brochure I recently came across, I’ve taken a look at L-1 Identity Solutions in a new Cato TechKnowledge. Though it has better options, L-1 and its new acquisition, Digimarc ID Systems, seem likely to continue lobbying for the REAL ID Act. My concluding line: “A corporate lobbying operation can do as much harm to liberty as any government agency or official.”

California: Poster Child for Poor Fiscal Management

On Wednesday Gov. Arnold Schwarzenegger is releasing his revised budget proposal against a backdrop of a massive deficit.  In my op-ed in today’s San Francisco Chronicle, I lay out the background of the “fiscal crisis” in the state (too much spending) and point out a few specific programs the governor can terminate.  Enacting a spending limit and working to increase the use of public-private partnerships would be great, but this year’s budget debate highlights the need to also eliminate programs, cut spending (not merely spending growth) and refocus the state government on its core functions. 

Not from California?  Your state has also likely forgotten the lessons of the 1990s and may have its own “crisis” brewing. 

‘Testilying’

“Testilying” is a term that police officers use to describe false testimony they give in court so that an otherwise illegal search or arrest can be justified.  It’s hard to tell how common the practice is, but it’s much more common than most people want to believe.

This New York Times report is telling.  First, we don’t know how many illegal searches and arrests take place because, as Federal Judge John Martin observes, “We don’t have statistics for all the people who are hassled, no gun is found, and they never get into the system.”  These are low-visibility state offenses that we might call state misdemeanors.  They happen all over but more often in the poorer neighborhoods.  Who would go to the trouble of consulting a lawyer for an illegal 10 minute police stop and pat-down?  How many lawyers would bother to take such a case if someone did walk in off the street with such a complaint?

Next come the cases where the police find contraband and go to court with a fabricated story in order to try and get a conviction.  In a system where such conduct goes unpunished, it’s safe to say we’re going to get more of it.  And the cops who skirt the rules are likely to rise through the ranks faster.  After all, they have many more arrests to their credit than their peers.

Note the utter indifference of the police and prosecutors to reports of testilying.

Kudos to the New York Times for this “revealing glimpse” of our troubled system.  For some related Cato work, go here and here