Wisconsin’s Criminalization of Political Speech

Just when you thought the long-running “John Doe” prosecution/persecutions in Wisconsin couldn’t get any worse—SWAT teams conducting pre-dawn raids on family homes, gag orders on the victims, and the prosecutor’s recusal motion directed against no fewer than four state supreme court justices, all over politically driven campaign finance allegations—Milwaukee County District Attorney John Chisholm suggested over the weekend that Gov. Scott Walker could be criminally charged for lying. Walker’s “crime”? In Iowa on Saturday, he questioned whether the prosecution’s tactics were constitutional.

As so often happens in litigation over often inscrutable campaign finance law, this case is a tangle of legal complexities, many of which are outlined in Cato’s amicus brief, urging the U.S. Supreme Court to hear the appeal of the “John Does,” their lives on hold as they suffer in silence. At its conference last Friday, the Court considered their cert petition, but it was not included in the Court’s list of denials this morning, indicating a “hold” and hence an increased likelihood that the Court will hear the appeal.

Only two weeks ago, in her first campaign stop in Iowa, Hillary Clinton took a shot at the Roberts Court, calling for a constitutional amendment to overturn the Court’s Citizens United decision. That would amount to nothing less than an assault on the First Amendment’s protection of political speech. With that speech so threatened, no better illustrated than in the appalling Wisconsin prosecutions, it’s time for the Court to bring an end to this tyranny.

For Ronald Reagan Peace through Strength Did Not Mean War at Any Price

Alzheimer’s robbed Ronald Reagan of his memory. Now Republican neocons are trying to steal his foreign policy legacy. Reagan likely would have been appalled by the aggressive posturing of most of the Republicans currently seeking the White House.

Ronald Reagan’s mantra was “peace through strength.” Peace was the end, strength the means. He focused on the Soviet Union and its advanced outposts, especially in the Western Hemisphere.

Restraining the hegemonic threat posed by an aggressive, ideological Soviet Union led to Reagan’s tough policy. Still, Reagan avoided military confrontation with Moscow. Indeed, he routinely employed what neocons today deride as “appeasement.”

For instance, Reagan dropped the Carter grain embargo against Moscow. Reagan said he desired to encourage “meaningful and constructive dialogue.”

Lech Walesa and the Solidarity movement were a global inspiration but the Polish military, fearing Soviet intervention, imposed martial law in 1981. No American bombers flew, no invasion threatened, no soldiers marched. Reagan waited for the Evil Empire to further deteriorate from within.

However, Reagan wanted to negotiate—from a position of strength, but he still wanted to negotiate.

Throw out Massachusetts’s Sedition Act

John Adams left his state a conflicted legacy. As a young man in 1765, Adams took to the Boston Gazette to protest censorship, reminding his readers that “liberty cannot be preserved without a general knowledge among the people,” and for that reason “none of the means of information are more sacred, or have been cherished with more tenderness and care by the settlers of America, than the press. Care has been taken that the art of printing should be encouraged, and that it should be easy and cheap and safe for any person to communicate his thoughts to the public.” Fifteen years later, Adams was called upon to write a constitution for the Commonwealth of Massachusetts, which provided that as “[t]he liberty of the press is essential to the security of freedom in a State; it ought not, therefore, to be restrained in this commonwealth.”

Wise words from a wise man. But two decades hence later, Adams was no longer a young man, and no longer so wise.

In 1798, Adams was an embattled and unpopular president, under constant fire from the nation’s papers. In response, he pushed through a law that made it a crime to “write, print, utter or publish … any false, scandalous and malicious writing or writings against the government of the United States.”

Reviled as an unconstitutional affront to liberty, the Sedition Act was so unpopular that it cost Adams a second term, and has served for over 200 years as a symbol of tyrannical overreach. Adams also gave his name to the courthouse where the Supreme Judicial Court of Massachusetts meets; that Court will now have to decide which version of Adam’s legacy it will embrace.

For almost 100 years, Massachusetts has had its own version of the Sedition Act, a law making it crime to publish “any false statement in relation to any candidate for nomination or election to public office, which is designed or tends to aid or to injure or defeat such candidate.” Cato has filed a brief pointing out just how absurd and unconstitutional this law is.

No, not that brief, but if the law sounds familiar it should: Ohio had a similar law—until a trip up from the federal district court to the U.S. Supreme Court and back resulted it in being struck down. Statutes in Minnesota and Washington have suffered the same fate. These laws are a direct and indefensible attack on the freedoms protected by the First Amendment, and because John Adams was right when he described censorship as the “jaws of power … always opened to devour, if possible, to destroy the freedom of thinking, speaking, and writing,” it’s time for Massachusetts to follow suit.

As a more modern president from the Commonwealth once said, the government cannot be “afraid to entrust the American people with unpleasant facts, foreign ideas, alien philosophies, and competitive values. For a nation that is afraid to let its people judge the truth and falsehood in an open market is a nation that is afraid of its people.”

The Massachusetts Supreme Judicial Court hears argument in Commonwealth v. Lucas on May 7.

Was Monetary Policy Loose During the Housing Boom?

Did the Fed’s set its policy interest rate below the market-clearing or ‘natural’ interest rate level in the early-to-mid 2000s? Or did it simply lower its policy interest rate down to a depressed natural interest rate level during this time? The answers to these questions determine whether U.S. monetary policy was loose during the housing boom.

John Taylor believes the Fed pushed interest rates below their natural interest rate level. He views this departure from a neutral stance as a key contributor to the housing boom. Ben Bernanke and Larry Summers believe otherwise. They see the Fed simply doing its job back then by adjusting its policy rate down to a low natural interest rate level. Bernanke believes the natural interest rate level was low because of a saving glut while Summers holds that its was depressed because of secular stagnation. Either way, both individuals do not blame the Fed for any role the low interest rates played in fostering the housing boom. The Fed’s lowering of interest rates was simply an endogenous response.

George Selgin, Berrak Bahadir, and I recently published an article that lends support to John Taylor’s view of Fed policy during this time. It received some pushback from Scott Sumner who is sympathetic to both the saving glut and secular stagnation views. At the same time, Tony Yates provided a critique of John Taylor’s argument on the financial crisis that was heartily endorsed by Paul Krugman. So the debate over the Fed policy during this period continues.

What I want to do here is to step back from this debate and review what I see as the key economic developments that affected U.S. interest rates at this time. Then, given these considerations, I will jump back into the debate and ask whether Fed policy pushed interest rates in the same direction as that implied by these developments.

The key developments as I see them are threefold: a falling term premiums, a spate of large positive supply shocks, and the emergence of a monetary superpower. Let us consider each one in turn.

You Ought to Have a Look: Earth Day Round-Up

You Ought to Have a Look is a feature from the Center for the Study of Science posted by Patrick J. Michaels and Paul C. (“Chip”) Knappenberger. While this section will feature all the areas of interest that we are emphasizing, the prominence of the climate issue is driving a tremendous amount of web traffic.  ere we post a few of the best in recent days, along with our color commentary.

Since the Earth Day coverage this year seemed rather meager—a sign, perhaps, that everyone is growing tired of the pessimistic drone that defines the current environmental movement—it is possible that you may have overlooked a few stories out there that shine a more positive light on the human condition and the way forward.

You ought to take a few minutes and take Alex Epstein’s short course from Prager University. It is presented in the form of a 5-minute video titled “Why You Should Love Fossil Fuel.” Here’s course description:

Every year on Earth Day we learn how bad humanity’s economic development is for the health of the planet. But maybe this is the wrong message. Maybe we should instead reflect on how human progress, even use of fossil fuels, has made our environment cleaner and healthier. Alex Epstein of the Center for Industrial Progress explains.

We hope you like this, because you’ll undoubtedly be hearing much more from Alex in the future as we are happy that he has joined us at the Center for Study of Science as one of Cato’s newest adjunct scholars.

The Year of Educational Choice: An Update

Back in February, I speculated that 2015 might be the “Year of Educational Choice” in the same way that the Wall Street Journal declared 2011 the “Year of School Choice” after 13 states enacted new or expanded school choice laws.

This year, in addition to a slew of more traditional school choice proposals, about a dozen legislatures considered new or expanded education savings accounts (ESAs). As I explained previously:

ESAs represent a move from school choice to educational choice because families can use ESA funds to pay for a lot more than just private school tuition. Parents can use the ESA funds for tutors, textbooks, homeschool curricula, online classes, educational therapy, and more. They can also save unused funds for future educational expenses, including college.

Currently, two states have ESA laws: Arizona and Florida. Both states redirect 90% of the funds that they would have spent on a student at her assigned district school into her education savings account. The major difference between the two laws is that Arizona’s ESA is managed by the Arizona Department of Education while Florida’s is privately managed by Step Up For Students and AAA Scholarships, the nonprofit scholarship organizations that also issue scholarships through the Sunshine State’s tax credit law.

Both Arizona and Florida expanded their ESA programs this year. Earlier this month, Arizona expanded eligibility for the ESA to students living on Native American reservations. And just today, the Florida House of Representatives voted unanimously to expand its ESA. Travis Pillow of the RedefinED Online blog explains:

A Reasonably Good Week for the Fourth Amendment

This week, two federal court decisions here in D.C. reiterated the importance of the Fourth Amendment in police encounters.

In the U.S. Supreme Court, Justice Ruth Bader Ginsburg wrote the Court’s opinion in Rodriguez v. United States, declaring that prolonging a traffic stop to initiate a K-9 sniff of a vehicle was unconstitutional. It’s not a revolutionary decision or a watershed moment in the Court’s Fourth Amendment jurisprudence, but it’s always good to see the Court recognize that there are limits on the police during traffic stops. (Such recognition is not usually the case.) That said, police will still try to find ways to get you to surrender your rights during stops.

Down the street at the U.S. Court of Appeals for the D.C. Circuit, Judge Janice Rogers Brown wrote a concurrence in a case that gets to the heart of the problem in Fourth Amendment law today. Because lower courts are not allowed to ignore Supreme Court holdings even when judges think SCOTUS is wrong, Judge Brown had to vote in favor of the government. But in United States v. Gross, concerning D.C.’s roving patrols for illegal firearms in high crime areas, Judge Brown was quite clear when she wrote:

Despite lacking any semblance of particularized suspicion when the initial contact is made, the police subject these individuals to intrusive searches unless they can prove their innocence. Our case law considers such a policy consistent with the Fourth Amendment. I continue to think this is error. Our jurisprudence perpetuates a fiction of voluntary consent where none exists and validates a policy that subverts the framework of Terry v. Ohio, 392 U.S. 1 (1968).

In the absence of any particularized reports, evidence, or suspicions, patrolling officers simply question every likely person they encounter. They “employ[] a simple technique: they ask[] any individual they encounter[] if he or she ha[s] a gun and then watch[] to see if that individual engage[s] in what the officers perceive[] to be suspicious behavior.” If consent to question or search is refused, officers frequently construe citizens’ varied reactions to their probes as rationalizing a Terry stop.

As a thought experiment, try to imagine this scene in Georgetown. Would residents of that neighborhood maintain there was no pressure to comply, if the District’s police officers patrolled Prospect Street in tactical gear, questioning each person they encountered about whether they were carrying an illegal firearm? Nothing about the Gun Recovery Unit’s modus operandi is designed to convey a message that compliance is not required. While viewing such an encounter as consensual is roughly equivalent to finding the latest Sasquatch sighting credible, I submit to the prevailing orthodoxy, but I continue to reject its counterintuitive premise.

With the guise of voluntary consent stripped away, the reality of the District’s regime is revealed. It is a rolling roadblock that sweeps citizens up at random and subjects them to undesired police interactions culminating in a search of their persons and effects. If the Fourth Amendment is intended to offer meaningful protection in the context of Terry stops, the voluntary consent exemption cannot be used to engage with members of the public en masse and at random to fabricate articulable suspicions for virtually every citizen officers encounter on patrol. (Internal citations omitted.)

The state of Fourth Amendment jurisprudence is not good, but cases like these provide a glimmer of hope that the Supremes will come around one of these days. You should read Judge Brown’s full concurrence here.