Cato Daily Dispatch for February 22, 2005
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Two High Court Cases Test Property RightsSocial Security Reform Goes to the Heartland
Supremes to Hear Peer-to-Peer Networking Case
Two High Court Cases Test Property Rights
"Champions of property rights took cheer in 1986 when William H. Rehnquist became the chief justice of the United States," the Los Angeles Times reports. "Since the early 1990s, however, the property rights movement's progress in the courts has stalled. Today, in what is likely to be the last term of the Rehnquist Court, the justices take up two disputes that could change that."
Cato has filed friend-of-the-court briefs in both cases. The first case, Kelo v. City of New London, tests whether government can condemn private property and transfer title to others simply to encourage economic development and create a larger tax base. In a Cato Policy Analysis out today, Ilya Somin, assistant professor of law at George Mason University, argues that the Constitution bans the government from taking property for economic development.
"Such takings are usually the product of collusion between large and powerful interests and government officials against comparatively powerless local residents," he writes. "They generally produce far more costs than benefits."
Cato's amicus briefs in Kelo and today's other case, Lingle v. Chevron, can be found [here].
Social Security Reform Goes to the Heartland
"Rep. Paul Ryan (R-Wis.) spent his holiday discovering that President Bush's idea of adding personal accounts to Social Security can be as hard to sell back home as it is in Washington," the Washington Post reports.
"Ryan, who will help write the legislation as a member of the Ways and Means subcommittee on Social Security and is a longtime proponent of changing the popular government retirement program, is pushing the White House idea to farmers and factory workers throughout his district in the southeastern corner of the dairy state, with 35 'listening sessions' in 12 days."
Under the direction of Michael Tanner, Cato's Project on Social Security Choice has produced an abundance of studies, op-eds and books detailing the benefits of Social Security reform through individual accounts. "The Social Security payroll tax is already 12.4 percent of wages, or one eighth of a worker's total annual wages," Tanner writes in "Social Security: Follow the Math." "It is the biggest tax the average household must pay. Roughly 80 percent of American families pay more in Social Security taxes than they do in federal income taxes.
"Despite that already huge tax burden, the payroll tax will have to be increased by nearly half in order to continue paying Social Security benefits. That's a terrible burden to impose on our children and grandchildren. The only way out of this problem is to change Social Security from a pay-as-you-go model to a system based on savings and investment."
Supremes to Hear Peer-to-Peer Networking Case
"Next month, the U.S. Supreme Court is scheduled to hear arguments on whether a file-sharing service named Grokster should be held liable for the millions of people around the world who use it to illegally trade music, movies and software," reports the Washington Post.
"The entertainment industry is asking the court to rule that even though Grokster itself does not engage in stealing files, the service is responsible because it is predominantly used for theft and has done nothing to try to stop that use."
In the recent Cato Policy Analysis "Peer-to-Peer Networking and Digital Rights Management: How Market Tools Can Solve Copyright Problems," Michael A. Einhorn, author of Media, Technology, and Copyright: Integrating Law and Economics, and Bill Rosenblatt, president of GiantSteps Media Technology Strategies, argue that government interference in peer-to-peer networks would hinder technological evolution. A better alternative would be for government to step aside and allow the market to find a solution through digital rights management.
Einhorn and Rosenblatt write that "the government should act to protect property rights, including copyrights, but it should not pick winners or discourage any technology from competing in the new marketplace."
Wyatt DuBois, editor, wdubois@cato.org