Balanced-Budget Amendment to the Constitution

Presidential candidate Rand Paul has announced his support for a balanced-budget amendment (BBA) to the U.S. Constitution. This is an old idea, but a good idea. A BBA has been proposed in Congress as far back as 1936. In 1982 the Senate passed a BBA by a vote of 69-31, but it failed to get the needed two-thirds approval in the House. In 1995 a BBA passed the House by a 300-132 margin, but it fell one vote short of passage in the Senate.

Today we need a BBA more than ever. Historical budget data show that federal politicians have become increasingly irresponsible over the years. The bipartisan 19th century belief that balancing the budget was morally proper and economically prudent disappeared during the 20th century. As the chart below shows, from 1791 to 1929 the federal government balanced its budget in 68 percent of the years. But from 1930 to 2015, the government balanced its budget in just 15 percent of the years.

What changed in the 1930s? The unfortunate rise of Keynesian economics encouraged politicians to think that deficit spending helped the economy. Also, the 1935 creation of Social Security launched the government into the era of “entitlement” spending, which is spending that is on automatic pilot. Entitlement spending grows relentlessly year after year without politicians having to vote for the increases. It allows politicians to pretend that they are not responsible for the resulting deficits and debt.  

A legal cap on overall federal spending would be a better way to restrain the budget than a BBA. But either way, let’s hope that Paul can spur a renewed debate on fiscal control. We need it: despite today’s growing economy, the current administration recently proposed a budget that has half-trillion-dollar deficits as far as the eye can see. From a historical perspective, that sort of disregard for fiscal prudence is remarkable. In his 2014 book, America’s Fiscal Constitution, Democratic politician and financial executive Bill White argued that until recently, aiming for balanced budgets was part of an “informal constitution” that both parties understood.

Another 2014 book, A Nation Wholly Free, examined the drive to eliminate the federal debt under President Andrew Jackson in the 1830s. Author Carl Lane found,

Debt freedom, Americans in the Jacksonian era believed, would improve the material quality of life in the United States. It would reduce taxes, increase disposable income, reduce the privileges of the creditor class, and, in general, generate greater equality as well as liberty.

Those early Americans were right about debt freedom. A frugal government that balances its books helps to secure liberty and benefits average citizens. Hopefully, Paul and other reform-minded candidates can revive such sound fiscal thinking in Washington.

What if Slager Had Been Wearing a Body Camera?

At the press conference this week about officer Michael Slager’s killing of Walter Scott, North Charleston Mayor Keith Summey said that he had ordered an additional 150 police body cameras. According to Summey, every officer in the North Charleston Police Department will be outfitted with a body camera once they have been trained to use it and a body camera policy has been written. In February, the city announced that it would spend $85,000 of a $275,000 federal grant on 115 body cameras.

It is, of course, impossible to know how Slager would have behaved if he had been wearing a body camera during his encounter with Scott. But it is worth conducting the thought experiment nonetheless. 

Let’s consider footage of the incident captured by Feidin Santana, a bystander. In the video, Scott flees a scuffle with Slager following a routine taillight traffic stop. There appear to be Taser barbs attached to Scott as he runs away from Slager, who fires eight rounds as him while standing flat-footed. Scott falls about 15–20 feet from Slager after the eighth round is fired. (The coroner reportedly told one of Scott’s family lawyers that five of those rounds hit Scott.) Slager then handcuffs Scott, returns to where the scuffle took place, picks up an object, and drops that object near Scott.

Police reports state that officers performed CPR on Scott, yet the footage shows no officers performing CPR. The video does show Scott receiving some medical attention, but this is several minutes after the shooting and does not include CPR. 

It is hard to imagine that if Slager had been wearing an operating body camera that he would have behaved the way he did. Knowing that first-person footage of the incident would be seen by investigators, would Slager have planted an object–widely believed to be his Taser–near Scott after the shooting? Would Slager, a CPR-certified officer, have left Scott without medical attention? Would he have claimed that he felt threatened when he fired eight rounds at a fleeing 50-year-old man? Would he have even fired his weapon at all?

Even if the answer to each of those questions is “yes,” a body camera would have provided officials with more information than written police reports.

Thankfully, Santana was at the scene of Scott and Slager’s scuffle and provided video showing that police reports of the killing presented an inaccurate account of what happened. But the public should not have to rely on conscientious citizens with cellphone cameras who happen to be in the right place at the right time to ensure that incidences of police misconduct are accurately reported.

Police Misconduct: The Worst Case in March

Over at Cato’s Police Misconduct website, we have identified the worst case of the month for March: the conspiracy to frame an innocent man, Douglas Dendinger, in Bogalusa, LA.

Here’s the story: Dendinger agreed to take on the task of a “process server.” That is, he would hand-deliver legal papers to a person who has been sued, putting that person on notice about the legal action. In this instance, Dendinger was to serve papers on a former police officer, Chad Cassard, who was being sued for police brutality.

Dendinger found Cassard as he was leaving the local courthouse and made the delivery. At that moment, Cassard was in the company of several police officers and prosecutors. Those people became hostile and furious with Dendinger over what this lawsuit would mean for their friend/colleague.

The story then takes a bizarre and disturbing turn: Later that day, the police arrive at Dendinger’s home and arrest him on several charges, including two felonies (1) obstruction of justice and (2) witness intimidation. Cassard and a few of his cohorts claimed that Dendinger had served the papers in a violent fashion.

Because of those charges, Dendinger was in very serious legal trouble. He was looking at many years in prison.

Rebuttal of Sen. Sessions’ Anti-Legal-Immigration Op-ed

Senator Jeff Sessions’ (R-AL) Washington Post op-ed calls “for an honest discussion on immigration.” He then lays out his case against legal immigration. 

Although I appreciate Sessions’ honesty in calling for large reductions in legal immigration–a level of candor too often shrouded by immigration-restrictionists’ political correctness (“I’m only against illegal immigration”)–his op-ed makes a poor case for more government regulation of international labor markets.

Below, I look at Senator Sessions’ arguments against legal immigration. His writings will be in block quotes and my responses will follow.

The first “great wave” of U.S. immigration took place from roughly 1880 to 1930. During this time, according to the Census Bureau, the foreign-born population doubled from about 6.7 million to 14.2 million people. Changes were then made to immigration law to reduce admissions, decreasing the foreign-born population until it fell to about 9.6 million by 1970. Meanwhile, during this low-immigration period, real median compensation for U.S. workers surged, increasing more than 90 percent from 1948 to 1973, according to the Economic Policy Institute.

Senator Sessions only presents the income data for Americans during the time when immigration was restricted. Real per-capita GDP increased by 95 percent during the 1880–1930 period of high-immigration that he cites. There are other sources for wage data from that period, although all of them are troublesome compared to the modern economic information available.

The United States did not have closed borders from 1948 to 1973. The Bracero guest-worker visa program let in nearly five million lower-skilled Mexican workers to temporarily labor in American agriculture, a policy that did more to limit unlawful immigration during that period than any other.

Monetary Standards: An Introduction

A monetary standard is a set of institutions and rules governing the supply of money in an economy. These rules and institutions collectively constrain the production of money. Through its constraints on money creation, the standard indirectly acts on prices. A monetary standard may also affect the rate of growth of real economic output, but that depends on expectations. Monetary institutions may also affect other economic institutions, which themselves influence economic growth.

Some authors talk about a monetary regime, and still others a monetary constitution. For purposes of this discussion, the same underlying issues are being discussed.

The banking and financial system interacts with the monetary standard and differences in the one may affect how the other operates. Though very important, the banking and financial system is not my main focus.

Operation Decisive Failure

A front page story in today’s Washington Post highlights that the failure of the U.S.-backed, Saudi-led coalition campaign in Yemen is already becoming apparent:

Two weeks into a Saudi-led military campaign in Yemen, airstrikes appear to have accelerated the country’s fragmentation into warring tribes and militias while doing little to accomplish the goal of returning the ousted Yemeni president to power, analysts and residents say.

Foreign Policy makes similar points:

Through its backing of Saudi Arabia—with bombs, intelligence, refueling, and search-and-rescue capabilities—and Riyadh’s military intervention in Yemen, the United States is effectively at war with the impoverished land that occupies the southwestern heel of the Arabian Peninsula. That war is going spectacularly badly.

None of this should be surprising. Yemen’s history is replete with tribal conflict and failed invasions, as I highlighted yesterday in the New York Times. Yemeni insurgencies have defeated the British, the Egyptians, and the Saudis in the last 50 years alone.

Cuba and the State Sponsors of Terrorism List

President Obama has signaled that his administration may remove Cuba from the state sponsor of terrorism list. The change should have occurred years ago, but would be particularly appropriate now, at a time when the United States is trying to resume economic and diplomatic ties with the country. Cuba’s inclusion on the list is a major sticking point in these negotiations. 

It is reasonable to surmise that the defenders of the Cold War-era embargo, including Senator Marco Rubio and the editors of the Wall Street Journal, oppose a change in Cuba’s terror sponsor designation because they want to thwart normalization. They ignore the fact that the embargo has failed to bring about regime change in Havana, and has similarly failed to expand the freedoms of innocent Cubans caught in the middle of the running dispute between Washington and Havana. The WSJ notes, for example, that the Cuban government’s repression of political dissidents and human right activists continues, but doesn’t explain how a continuation of the status quo will force a change in Havana’s behavior. 

Indeed, the embargo hasn’t merely failed. It denies Americans their basic rights to trade with and travel to the country. It also functions as a convenient excuse for the Castros and their cronies when they are pressed to explain why Cubans lag well behind others in the Western Hemisphere in terms of economic development and basic living standards. It says a lot about the magnanimity of the Cuban people, who have been lied to for so long about U.S. intentions, and who have been told that America is to blame for their misery, that they still retain a measure of affection for their neighbor to the north. If removing Cuba from the list hastens the process toward normalization, that might be reason enough to do so.

But the best reason for removing Cuba from the state sponsor of terrorism list may be because Cuba does not appear to be a state sponsor of terrorism. As a story in today’s Washington Post notes, “In many ways, the U.S. designation, first imposed in 1982, is a Cold War relic. Although the United States strongly objects to Cuba’s domestic policies, it has offered no evidence for decades that Cuba is actively involved in terrorism abroad.”

This situation is not unique to Cuba. The terror sponsor list has become a catch-all for countries we don’t like very much, including for other reasons – human rights abuses, weapons proliferation, and general roguish behavior. Countries should be scorned, and perhaps even sanctioned, for such activities, but casting them as terrorist sponsors when they clearly are not renders the entire enterprise farcical. CFR’s Micah Zenko makes a great case for abolishing the state sponsor of terrorism list entirely. 

The president is unlikely to make such a dramatic step, of course, but he could push to ensure that it includes those states that actually do sponsor terrorism. An accurate list would likely include a number of long-time U.S. allies, which, no doubt, would make for some awkward embassy cocktail parties.