Budget Smackdown: Krugman vs. Portman and Epstein

In a recent column, Paul Krugman dismissed concerns about the federal debt as a “false alarm,” a “disaster that wasn’t,” and an “imaginary budget and debt crisis.”

Krugman thinks that new CBO projections don’t look too bad. He says, “debt in 2039 — a quarter-century from now! — is projected to be no higher, as a percentage of G.D.P., than the debt America had at the end of World War II.” He concludes that “we don’t have a debt crisis, and never did.”

Gene Epstein of Barron’s looked at CBO’s numbers and Krugman’s claims. He noted that Krugman only looked at CBO’s “baseline” projection, which shows federal debt held by the public rising from 74 percent of GDP today to 106 percent by 2039. Unlike Krugman, I find that increase alarming, especially because there is little political will right now to reverse course and bring down the debt—unlike after World War II.

Also, as I charted here, World War II debt was stunningly high, so I don’t know why Krugman would take comfort in the government becoming that indebted once again. The chart shows that aside from WWII, federal debt has never been anywhere near as high as it is now.

D.C. Circuit Rules that Obamacare Is a “Tax” but Not a “Bill for Raising Revenue”

The D.C. Circuit Court of Appeals today tossed out the latest constitutional challenge to Obamacare, which argues that if the individual mandate is a “tax,” as the Supreme Court said it is, it’s still unconstitutional because it did not originate in the House of Representatives, as the Constitution requires. I argued the case on behalf of entrepreneur Matt Sissel in May.

Today’s decision, written by Judge Judith Rogers and joined by Judges Cornelia Pillard and Robert Wilkins, holds that while the mandate may be a “tax,” it isn’t a “bill for raising revenue,” and is therefore exempt from the Origination Clause.

What’s the difference between a tax and a bill for raising revenue? Some court decisions have held that there are things that may appear to be taxes but are actually only penalties designed to enforce other kinds of laws. For example, in a 1943 case called Rodgers v. United States, the court of appeals said that a tax that was imposed on people for growing more wheat than the government allowed (that’s the same wheat law that was at issue in the infamous Wickard v. Filburn) wasn’t really a tax, but just an enforcement penalty or a fine. Such penalties aren’t “bills for raising revenue,” so they don’t have to start in the House.

The problem with that line of argument is that in NFIB v. Sebelius, the Supreme Court said that the individual mandate, whatever else it might be, is not a penalty or a fine. That’s just why Chief Justice Roberts concluded that it was a tax! And that means that no such exemption should apply.

Core Supporters: We’ve Just Been Too Darned Principled!

According to Politico, supporters of the Common Core have come to a realization: they are losing the public relations war. And what do they think the problem has been? They’ve just been too darned factual:

“The Common Core message so far has been a head message. We’ve done a good job talking about facts and figures. But we need to move 18 inches south and start talking about a heart message,” said Wes Farno, executive director of the Higher State Standards Partnership, a coalition supported by the U.S. Chamber of Commerce and the Business Roundtable.

Um, no.

The argument for the Core – to the extent one has even been given – has mainly been a simple one of “build high standards and success will come.” See, for instance, this recent op-ed from former Tennessee Representative Harold Ford (D), or these superficial videos from the U.S. Chamber of Commerce Foundation. For the most part, they simply assert that the Common Core represents high standards, and that’s what we need to vault near top place in the world educational and economic competition. This ignores the major empirical evidence I and many others have brought against the Core, and national standards generally, showing that standards – much less the Core itself – have demonstrated no such power. But Core supporters have very rarely engaged that crucial evidence, including before Washington did their bidding and coerced lightning-quick state adoption of the Core.

Iraq: No Military Redo a Decade Later

Little more than a decade ago the U.S. invaded Iraq.  The promised cakewalk turned out far different than expected.  Today the government—and entire state—created by Washington are in crisis.  Yet the same voices again are being raised calling for military intervention.  With the promise that this time everything will turn out well.

Social engineers never seem to learn.  It is hard enough to redesign and remake individuals, families, and communities in America.  It is far harder to do so overseas.

As I point out in my latest Freeman column:  “Nation-building requires surmounting often vast differences in tradition, culture, history, religion, ethnicity, ideology, geography, and more.  Doing so also requires suppressing the natural desire of people to govern themselves.”

Yet these days Washington continues to try to fix the world’s problems.  However, reentering Iraq would be unique, an attempted redo barely a decade after the first go. 

The original Iraq operation was supposed to be a quick, bloodless war that destroyed dangerous weapons of mass destruction and “drained the swamp,” eliminating terrorism.  The U.S. would guarantee a friendly, compliant government by imposing as president an exile who hadn’t lived in the country for decades.  The new Iraq would implement democracy, eschew sectarian division, protect women’s rights, and even recognize Israel, while providing America bases for use in attacking neighboring states, including Iran.

This wonderful wish list was pure fantasy. 

The conflict killed thousands and wounded tens of thousands of Americans, and killed hundreds of thousands and displaced millions of Iraqis.  The ancient Christian community was destroyed. 

The ultimate financial cost, including the expense of caring for those who sustained debilitating wounds, to America likely will run $3 trillion or more.  America’s reputation was stained, Iran was empowered, and terrorists were trained.  Finally, Baghdad’s sectarian misrule wrecked national institutions and fostered the rise of an ugly Islamic totalitarianism. 

The obvious—indeed, only—policy for Americans is to run, not walk, away from the mess.  Yet many of the architects of the original disaster are back, advocating a second shot.

Biden: “I Should Have Had One Republican Kid To Go Out And Make Money”

The Washington Free Beacon reports that Vice President Joseph Biden made his audience “burst into laughter” at the Urban League gathering in Cincinnati when he cracked “I should have had one Republican kid to go out and make money,” noting that instead he has a daughter who went into social work. 

And well should they have burst into laughter. It was a joke, folks! In real life, Biden’s son Beau has worked as an asbestos plaintiff’s lawyer, which is much more of a moneymaking venture than most “Republican kids” ever get near. Both he and another Biden son have been closely associated with one of the biggest such law firms in the nation. This fits a pattern noted by David Boaz a few weeks back, in which reporters keep acting surprised when Democratic politicians are found to be pals with zillionaires and attending fundraisers at mansions. 

Although Vice President Biden has not always been entirely forthcoming about his family’s longstanding ties to plaintiff’s law work, especially considering his own role as a guardian of trial lawyer causes while in the Senate, you might have seen them mentioned in places like the L.A. Times and USA Today a few years back. The L.A. Times story begins: 

When Joe Biden’s brother and son wanted to buy a hedge fund company two years ago, they turned for financing to a law firm that had lobbied the Delaware senator’s office on an important piece of business in Congress – and in fact had recently benefited from his vote. The firm promised James and Hunter Biden that it would invest $2 million, and quickly delivered half of it.

They wanted to buy a hedge fund? At least it presumably wasn’t a Republican hedge fund. 

 

 

 

 

Gray Lady Calls on Feds to Repeal Marijuana Prohibition

Yesterday, the New York Times ran a lengthy editorial, entitled “Let States Decide on Marijuana.”  Here is an excerpt:

Allowing states to make their own decisions on marijuana — just as they did with alcohol after the end of Prohibition in 1933 — requires unambiguous federal action. The most comprehensive plan to do so is a bill introduced last year by Representative Jared Polis, Democrat of Colorado, known as the Ending Federal Marijuana Prohibition Act. It would eliminate marijuana from the Controlled Substances Act, require a federal permit for growing and distributing it, and have it regulated (just as alcohol is now) by the Food and Drug Administration and the Bureau of Alcohol, Tobacco, Firearms and Explosives. An alternative bill, which would not be as effective, was introduced by Representative Dana Rohrabacher, Republican of California, as the Respect State Marijuana Laws Act. It would not remove marijuana from Schedule I but would eliminate enforcement of the Controlled Substances Act against anyone acting in compliance with a state marijuana law….

Congress is clearly not ready to pass either bill, but there are signs that sentiments are changing. A promising alliance is growing on the subject between liberal Democrats and libertarian Republicans. In a surprise move in May, the House voted 219 to 189 to prohibit the Drug Enforcement Administration from prosecuting people who use medical marijuana, if a state has made it legal. It was the first time the House had voted to liberalize a marijuana law; similar measures had repeatedly failed in previous years. The measure’s fate is uncertain in the Senate….

For too long, politicians have seen the high cost — in dollars and lives locked behind bars — of their pointless war on marijuana and chosen to do nothing. But many states have had enough, and it’s time for Washington to get out of their way.

Support for marijuana prohibition is collapsing.  And now that the Gray Lady has turned, many more people will conclude that it is now okay to join the cause (or at least stop opposing the cause).

For Cato scholarship on drug policy, go here.

Legalization or Amnesty for Unlawful Immigrants – An American Tradition

Legalization of unlawful immigrants, commonly referred to as amnesty, has been hyperbolically described as an affront to U.S. national sovereignty, the rule of law, and even our Constitutional Republic.  However, the U.S. government has a long history of successfully legalizing violators of immigration laws.

In 1929, the year the Immigration Act of 1924 went in effect, Congress passed an amnesty to allow for the voluntary registration of all unlawful immigrants who wished to legalize their unrecorded entry.  Beginning a familiar pattern, Congress combined this 1929 amnesty with severe legal penalties on unauthorized immigrants who entered the United States without inspection after the amnesty was complete.[i]

As part of the reforms of the Bracero Program’s guest worker visa in the late 1940s and early 1950s, many unauthorized Mexican migrants were legalized and granted a visa on the spot.  According to Professor Kitty Calavita, 55,000 unlawful Mexican immigrants were legalized as Bracero workers in 1947 through a process derogatively referred to as “drying out” unlawful migrant workers.[ii] Under the auspices of an increase in immigration enforcement and the expansion of the Bracero guest worker visa, other unlawful Mexican migrants were driven down to the Mexican border and made to take one step across the border and immediately reenter as a legal Bracero worker, a process referred to as “a walk around statute.”[iii]

In 1958, the cutoff date for the 1929 amnesty was advanced to June 28, 1940 – meaning that unlawful immigrants who entered before that later date could legalize.  The Immigration Act of 1965 again advanced the cut off date for the 1929 amnesty to June 30, 1948.[iv]

Year

 Legalizations of Unauthorized Immigrants

1959

4,321

1960

4,773

1961

5,037

1962

3,399

1963

2,680

1964

2,585

1965

2,064

1966

2,595

1967

3,195

1968

2,148

1969

1,565

1970

1,520

1971

1,190

1972

1,653

1973

1,254

1974

875

1975

556

1976

796

1977

546

1978

423

1979

262

1980

428

1981

241

Total

44,106

Source: Vernon M. Briggs Jr., Immigration Policy and the American Labor Force, The Johns Hopkins University Press, Baltimore, 1984, p. 66.

The Immigration Reform and Control (IRCA) Act in 1986 – the so-called Reagan Amnesty – legalized 2.7 million unauthorized immigrants who had been residing in the United States since 1982.  After IRCA, the Section 245(i) legalization passed in 1994 and was then extended again in 1997.  The 1997 Nicaraguan Adjustment and Central American Relief (NACARA) Act also legalized close to one million unlawful immigrants from Central America.  The Haitian Refugee Immigration Fairness (HRIFA) Act legalized around 125,000 unauthorized immigrants from Haiti in 1998.  The Legal Immigration Family Equity (LIFE) Act of 2000 reinstated the rolling 245(i) legalization provision. 

So long as there are immigration restrictions on the movement of peaceful and healthy people, and Americans want to continue to hire and sell products to immigrants, some will always come whether the immigration laws allow it or not.  To address the unlawful immigrant population, Congress periodically passes a legalization or amnesty bill, but the number of unlawful immigrants rises again because lawful immigration has not been sufficiently liberalized – despite vast increases in enforcement.

Past amnesties and legalizations of unauthorized immigrants didn’t destroy U.S. national sovereignty (the United States is still a sovereign country), the rule of law (in tatters for many reasons, including efforts to enforce our arbitrary and capricious immigration laws), or our Constitutional Republic.  It’s hard to see why another one passed by Congress and signed by the President would produce those grave harms.


[i] Vernon M. Briggs Jr., Immigration Policy and the American Labor Force, The Johns Hopkins University Press, Baltimore, 1984, p. 47.

[ii] Deborah Cohen, Braceros: Migrant Citizens and Transnational Subject in the Postwar United States and Mexico, University of North Carolina Press, 2011, p. 209, Kitty Calavita, Inside the State: The Bracero Program, Immigration, and the INS, Quid Pro Books, New Orleans, Louisiana, 2010, pp. 25-26, 34.

[iii] Kitty Calavita, Inside the State: The Bracero Program, Immigration, and the INS, Quid Pro Books, New Orleans, Louisiana, 2010, p. 43.

[iv] Vernon M. Briggs Jr., Immigration Policy and the American Labor Force, The Johns Hopkins University Press, Baltimore, 1984, p. 66.