Schools Have Plenty of Money!

How many times do we have to repeat that the United States spends more per elementary and secondary student than almost any other industrialized nation before our political leaders stop talking like our schools get by on pennies a day? And how often do we have to point to state spending to show that, annual cries of the sky falling notwithstanding, expenditures have been on a very long, inflation-adjusted upward trend?

Judging by this tired fare from new U.S. secretary of education Arne Duncan, and this standard story of rage from California, a lot more. So here you go:

Check out the OECD data here (table B1.1a)…

…see the figures for state spending here

…and reporters who cover incessant assertions of financial misery from educators, please check out the contact info for Cato’s media department here.

Operators are standing by.

Week in Review

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Cato Leads Opposition to Fiscal Stimulus

In reaction to statements from Obama administration officials who say “all economists agree” that the only way to fight the economic recession is to go on a massive government spending spree, the Cato Institute took out a full page ad in the nation’s largest newspapers that showed that those words were not true. Signed by more than 200 economists, including Nobel laureates and other highly respected scholars, the statement was published this week in The New York Times, The Washington Post and many other publications.

On the day the ad ran in The New York Times, Cato executive vice president David Boaz added more names to the list of economists who are skeptical of the spending bill.

Commenting on the principles behind the stimulus, Cato adjunct scholar Lawrence H. White and fellow economist David C. Rose discuss why we can’t spend our way out of this mess:

You can’t solve an excessive spending problem by spending more. We are making the crisis worse.

In The Wall Street Journal, Cato senior fellow Alan Reynolds examines the numbers and discovers that each government job created  will cost taxpayers a staggering $646,214 per hire.

The stimulus package now moving through Congress will spend nearly $1 trillion that the government does not have. With the nation already $1.2 trillion in the hole, Cato director of Tax Policy Studies Chris Edwards discusses the sheer illogic behind pushing for stimulus at a time like this:

If I get up in the morning and drink five cups of coffee and that doesn’t stimulate me, I don’t go and drink another five. I’d recognize my addiction problem and start reforming my bad habits. Federal policymakers should do the same.

For more on the stimulus plan, read Edwards’s Tax and Budget Bulletin, “The Troubling Return of Keynes,” (PDF) co-authored by Ike Brannon, former senior adviser to the U.S. Treasury.

During the House vote on the stimulus bill, just 11 Democrats voted against it, leaving Boaz to ask, “What Happened to the Blue Dog Democrats?

“Blue Dogs supported fiscal responsibility at some vague point in the misty past, and they will strongly support fiscal responsibility at some vague point in the future,” writes Boaz. “But right now they’re going to vote to put their constituents another $825 billion in debt.”

Obama Promises to Close Guantanamo Bay Detention Center

Cato legal policy analyst David H. Rittgers explains why he approves of Obama’s choice to shut down the prison at Guantanamo Bay and offers advice on how to proceed with the plan:

The Founders wrote the Bill of Rights after a violent insurgency brought on by government oppression, and the principles contained therein are no weaker while countering today’s terrorists. Using national security courts to try the detainees in Guantanamo opens the door to closed and classified trials of domestic terror suspects. This degradation of essential liberties is unwise and avoids the social function of trials.

Listen to a Cato Daily Podcast interview with Rittgers to learn more about the future of the Gitmo detainees.

In the forthcoming Cato Handbook for Policymakers, Timothy Lynch, director of Cato’s Project on Criminal Justice, lays out a plan for the future of our government’s strategy for dealing with terrorism. (PDF)

Gore Global Warming Hearing Goes on Despite Snowstorm

Undeterred by a snowstorm that shut down schools and gave federal workers “liberal leave,” the Senate Foreign Relations Committee held a hearing on global warming this week with star witness Al Gore. Gore promoted ways to end climate change through cap-and-trade legislation and investment in renewable energy, reported U.S. News and World Report.

In a Cato Policy Analysis, author Indur Goklany offers his commentary on how government should handle climate change.

Cato senior fellow in environmental studies Patrick J. Michaels offers his analysis on climate change, and how the international community should react.

Appearing on Fox News, Michaels, who is a former Virginia state climatologist, asserts that when it comes to climate change, there is no immediate emergency. For more, don’t miss Michaels’s new book, Climate of Extremes: Global Warming Science They Don’t Want You to Know, co-authored with Robert C. Balling Jr.

Burden of Stimulus and Debt

Politico noted that those opposing the stimulus plan:

 …say that borrowing more money to finance a stimulus package will pass a crushing and possibly permanent debt load on to the next generation. “The question is,” says Chris Edwards, the director of tax policy studies at Cato, “is this morally proper?” Edwards says no. “Policymakers are saying: ‘Screw the future generations.’”

Some people are skeptical of such statements, asking how government debt can impose a cost on future generations — after all, don’t we “owe it to ourselves?”

There is an economics answer to this, but you can also consider the basic libertarian theme of voluntarism vs. coercion.

Suppose there are three groups in society: beneficiaries of government programs, taxpayers, and creditors. Now suppose that in year one the government borrows $800 billion for a spending plan, which must be paid back in year two.

In year one, government beneficiaries are better off, taxpayers are not affected, and creditors are better off because they entered a voluntary financial exchange with the government. Since voluntary exchanges are mutually beneficial, nobody is worse off in year one.

The burden of deficit spending must be moved elsewhere — to year two. In year two, government beneficiaries are not affected and creditors receive their repayment. But taxpayers are hit with a bill for $800 billion plus interest, and this is no voluntary exchange. This is an $800 billion extraction with the full coercive power of the government coming into play.

Deficit spending pushes burdens into the future because it delays the use of coercive power. And unfortunately, there is a growing amount of federal coercion awaiting the next generation of young Americans, given that federal public debt is $7.2 trillion and rapidly rising.

Flowers Aren’t Enough

“Small Government Returns as [Republican] Maxim,” headlines the Washington Post.

The unanimous vote by House Republicans against President Obama’s stimulus plan provided an early indication that the GOP hopes to regain power by becoming the champion of small government, a reputation many felt slipped away during the high-spending Bush years.

But small-government voters may not be persuaded that the GOP has returned to its principles on the basis of one vote against a bill proposed by the other party, which happens to be, in the words of Republican whip Eric Cantor, likely “the largest spending bill in history.”

Like a wife whose husband has strayed dozens of times over the past eight years, small-government voters may not feel that one Valentine’s Day present is enough to restore trust. Especially when some of the prodigal Republicans are even now saying that they might vote for the largest spending bill in history on final passage.

Idle, Cleese for Daschle’s Health Care Rationing Board

In his recent book Critical, HHS secretary-nominee Tom Daschle proposes to create a federal health care rationing board empowered to deny medical care to patients in government health care programs and, ultimately, private health plans.

The stimulus bill moving through Congress gives Daschle his wish. It provides $400 million for HHS to launch a 15-member “Federal Coordinating Council for Comparative Effectiveness Research” that would conduct research intended to help government bureaucrats overrule your doctor.

Here are my nominations for Daschle’s rationing board:

Political Prevaricators

As the Illinois Senate prepared to remove Gov. Rod Blagojevich from office, Republican state senator Mike Murphy said that Blagojevich “is an unusually good liar.”

Not that good, apparently. Not good enough to stay in office. As opposed to another controversial politician of whom those same words were said a few years ago.

“Clinton is an unusually good liar,” Senator Bob Kerrey (D-Nebraska) once told Esquire magazine. “Unusually good.”

Better than Blago, it would seem.

Administration Delays E-Verify for Federal Contractors

The Washington Post reports that the Obama administration is delaying the Bush administration plan to require federal contractors to use the E-Verify worker background check system.

Criticizing the move, Lamar Smith (R-TX), ranking minority member on the House Judiciary Committee, says, “It is ironic that at the same time President Obama was pushing for passage of the stimulus package to help the unemployed, his administration delayed implementation of a rule designed to protect jobs for U.S. citizens and legal workers.”

E-Verify may well have been designed or intended to protect jobs for citizens and legal workers, but that’s not at all what it would do. I wrote about it in a Cato Policy Analysis titled “Electronic Employment Eligibility Verification: Franz Kafka’s Solution to Illegal Immigration” (a 10-year follow-on to Stephen Moore’s “A National Id System: Big Brother’s Solution to Illegal Immigration”):

A mandatory national EEV system would have substantial costs yet still fail to prevent illegal immigration. It would deny a sizable percentage of law-abiding American citizens the ability to work legally. Deemed ineligible by a database, millions each year would go pleading to the Department of Homeland Security and the Social Security Administration for the right to work.

Even if E-Verify were workable, mission creep would lead to its use for direct federal control over many aspects of American citizens’ lives. Though it should be scrapped, the longer E-Verify is delayed, the better.