Was the Halbig Decision Political?

Writing in the Washington Post about the D.C. Circuit’s decision in Halbig v. Burwell, E. J. Dionne Jr. bemoans 

a conservative judiciary that will use any argument it can muster to win ideological victories that elude their side in the elected branches of our government.

There are several problems with his argument. First, of course, the argument accepted by two judges on the D.C. Circuit is pretty strong: the IRS can’t rewrite a law just because because the law isn’t working out so well.

Second, it’s not so clear that it’s conservatives who couldn’t “win ideological victories … in the elected branches of our government.” Democrats in Congress and other ACA supporters wanted states to establish exchanges, so they wrote the law with subsidies for state exchanges. (See also this original paper by Michael Cannon and Jonathan Adler, especially pp. 142ff.) But because of widespread opposition to the law, many states chose not to set up exchanges. That is, supporters of the law were unable to “win ideological victories … in the elected branches of our government,” so they turned to the unelected bureaucracy to rewrite the law, and now they want the courts to uphold their end run around the legislative process.

Third, I wonder if E. J. Dionne Jr. really wants a judiciary that rolls over for the political branches, whether legislative or executive. Does he believe that the Warren Court should not have struck down school segregation, which was clearly the will of the people’s elected representatives–and no doubt the people–in Kansas, as well as in South Carolina and Virginia, whose similar cases were combined with Brown? Does he believe that the Supreme Court was wrong to strike down Virginia’s law against interracial marriage in 1967? The Texas law outlawing sodomy in 2003? Does he regret the Supreme Court’s reining in of the Bush administration’s claimed powers in several terrorism cases? Or the court’s 2013 rulings on gay marriage?

Probably not. And that’s why we should judge judicial decisions on the basis of their adherence to the law and the Constitution, not on political grounds. Three cheers for judges who uphold the rule of law without fear or favor and without political intent.

Who Is Transit for?

Rail advocates often call me “anti-transit,” probably because it is easier to call people names than to answer rational arguments. I’ve always responded that I’m just against wasteful transit. But looking at the finances and ridership of transit systems around the country, it’s hard not to conclude that all government transit is wasteful transit.

Nationally, after adjusting for inflation, the APTA transit fact book shows that annual taxpayer subsidies to transit operations have grown from $1.6 billion in 1970 to $24.0 billion in 2012, yet per capita ridership among America’s urban residents has declined from 49 to 44 trips per year. A lot of that money ends up going to unionized transit workers, but the scary thing is that these workers have some of the best pension and health care plans in the world that are mostly unfunded–which means that transit subsidies will have to increase in the future even if no one rides it at all.

Capital and maintenance subsidies are nearly as great as operating subsidies, largely due to the industry’s fascination with costly rail transit. In 2012, while taxpayers spent $24 billion subsidizing transit operations, they also spent nearly $10 billion on maintenance, and more than $7 billion on capital improvements. In 2012, 25 percent of operating subsidies went to rail transit, but 56 percent of maintenance and 90 percent of capital improvements were spent on rails.

Who, other than rail contractors, union members, and other transit agency employees, is enjoying the benefits of all of these subsidies? To answer this question, I went to the Census Bureau’s American Community Survey page and downloaded table B08519, which shows how people get to work by income class, for states and metropolitan areas.

Corporate Tax Inversions Made Simple

Numerous responses to my article in the New York Times yesterday about corporate tax inversions indicated a lack of understanding. Related articles by Levin, Johnston, and Huang similarly suggested that further enlightenment is needed.

The following chart should simplify the issue for NYT readers, columnists, and policymakers.

All data from KPMG. Global average is for 134 countries.


South Carolina Police Are Ready To Crack Down on Uber

Earlier this month UberX, Uber’s rideshare service, launched in four cities in South Carolina. Residents of Charleston, Greenville, Columbia, and Myrtle Beach are free to download Uber’s app and request a ride from a driver using his or her own vehicle. However, police across South Carolina are planning on taking action against UberX drivers, who they believe are violating regulations.

According to the South Carolina Office of Regulatory Staff, Uber is illegally operating in the Palmetto State without state or local business licenses.

The Nerve, a project of the South Carolina Policy Council, reported that police officers in Greenville and Columbia could issue UberX drivers warnings and citations at their discretion.

Myrtle Beach officials claim that Uber is not licensed to work in the city, and Myrtle Beach police have said that they plan to cite UberX drivers for operating without a business license, which Myrtle Beach officials claim each driver needs. Uber believes that it does not need a business license because it is connecting passengers and drivers via its app and not providing rides.

From WPDE NewsChannel 15:

So why doesn’t Uber just get a business license? Taylor Bennett, an Uber spokesperson said they don’t think they need one.

A Needlessly Confrontational Trade Policy Pitch

Thanks to an ad campaign by a U.S. agriculture group, Washington, DC, commuters—especially those who work on Capitol Hill—have been learning about Japan and the Trans-Pacific Partnership.  The agribusiness lobby group called “Keep Food Affordable” has covered one DC metro station with ads complaining about Japan’s effort to maintain some of its tariffs in the TPP negotiations. 

No Special Treatment for Japan

It’s rare to see public advertising about trade policy.  This is true even in the unique DC market where commuters encounter pitches for other strange things like fighter jets, tax reform, and museums dedicated to remembering genocide. 

When trade policy does make it into advertising space, it’s almost always bad.  Election campaigns and advocacy groups use emotionally charged language to push protectionist policies: ‘China is poisoning us,’ ‘international organizations are stealing our country,’ ‘small town life is fading,’ ‘baby seals are dying,’ etc. 

Inventions to Eagerly Await

Humans are progress seekers. Those with an entrepreneurial drive use their intellect to invent novel solutions to our problems. Sometimes, their solutions alleviate widespread suffering and let us live better than kings of centuries past. Thomson Reuters released just such a list of welfare-enhancing inventions to expect by 2025:

Dementia, Alzheimer’s, cancer drug-induced deaths, and Type I diabetes should afflict far fewer individuals by 2025. See below that cancer–one of the most common causes of death in several countries–is already on the decline (with a graph made on HumanProgress.org):

Molehill of Antarctic Ice Becomes a Mountain

Global Science Report is a feature from the Center for the Study of Science, where we highlight one or two important new items in the scientific literature or the popular media. For broader and more technical perspectives, consult our monthly “Current Wisdom.

In science,…novelty emerges only with difficulty, manifested by resistance, against a background provided by expectation. Initially, only the anticipated and usual are experienced even under circumstances where the anomaly is later to be observed.

–Thomas Kuhn, The Structure of Scientific Revolutions (1962)

One of global warming’s “novelties” is that satellite measurements show the extent of ice surrounding Antarctica is growing significantly, something not anticipated by our vaunted climate models.

Thomas Kuhn would predict “resistance”, and today we see yet another verification of how stubborn science can be in the face of results don’t comport with the reigning  paradigm.  The paradigm, in this case, is that our climate models are always right and any counterfactuals are because something is wrong with the data, rather than with the predictions.

“Resistance” means that peer-reviewers aren’t likely to find much wrong with papers that support the paradigm (and that they will find a lot wrong with ones that don’t).  Further, the editors of scientific journals will behave the same, curiously avoiding obvious questions.

Perhaps as fine an example as there is of this process appeared June 21 in the journal The Cryosphere, which is published by the European Geosciences Union.  It is a paper called  “A spurious jump in the satellite record:  has Antarctic sea ice expansion been overestimated?”, by Ian Eisenman (Scripps Institution) and two coauthors.

As shown in our figure, the increase in Antarctic ice extent has been quite impressive, especially since approximately 2000.

Not so fast.  Eisenman et al. write that “much of the expansion [of Antarctic ice] may be a spurious artifact of an error in the processing of satellite observations” [emphasis added].

Wow, that would be really something, knocking down one of the glaring anomalies in global climate, and adding credence to the models.  Eisenman et al. note

In recent years there has been substantial interest in the trend in Antarctic sea ice extent…primarly due to the observed asymmetry between increasing ice extent in the Antarctic and rapidly diminishing ice extent in the Arctic (e.g. Cavalieri et al., 1997) and the inability of current models to capture this (e.g. Eisenman et al, 2011).

No doubt working from the premise that the observed increase in Antarctic ice just can’t be right, Eisenman et al. would appear to have finally verified that hypothesis.

Until you look at the numbers.

Then you are left questioning the review process—at all levels—relating to this work.

The key finding is that there was a processing error in the data.  Microwave sensors that are used to estimate ice extent (and also lower atmospheric temperature) wear out in the harsh environment of space, and new satellites are launched with fresh equipment.  But each one doesn’t send data with the exact same statistical properties, so a succeeding sensor is “calibrated” by comparison with an existing one.

Eisenman et al. found that there was a change in the intercalibration between instruments in December, 1991 when the data were reprocessed in 2007.  Apparently this wasn’t immediately obvious because there is so much “noise” in the data.

Indeed, Eisenman et al have located the needle in this haystack, showing the step-change between the two data sets:

Please take a look at the y-axis.  You will see that the value of the “step” change is about 0.2 times 106 square kilometers, or 200,000 square kilometers.

Wow, that’s a lot!  After all, Eisenman et al. tell us that this shift explains “much” of the increase in Antarctic sea ice.

Hopefully readers caught on before going this far.  If the reason that the shift was undetected is because the data is so noisy, how important can it be?  Now, have a look at the overall ice extent, shown in our first figure.

The y-axis is in millions of square kilometers.  The change since the turn of the century is about 1.3 million square kilometers, a mountain of ice  The step change is about 200,000, a molehill.   That doesn’t sound like “much” to us.

But, hey, if you don’t look too close—and we are sure are greener friends (or the reviewers) won’t (or didn’t)—you might believe that everything is ok with the reigning, model-based paradigm.  In fact there’s “much” that is wrong with it.

As Kuhn wrote, “Only the anticipated and usual are experienced even under circumstances where the anomaly is later to be observed.”