Cato Daily Dispatch for September 21, 2004
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$280 Billion Federal Tobacco Case BeginsJudge Strikes Down FEC Rules
Bush Lifts Libya Sanctions
$280 Billion Federal Tobacco Case Begins
"After five years of legal wrangling, the nation's largest cigarette-makers are meeting federal lawyers in court for the trial phase of the government's record $280 billion civil racketeering suit against the tobacco industry," the Associated Press reports.
In "What Are They Smoking at the Justice Department?" Cato Senior Fellow Robert A. Levy writes: "The federal lawsuit is part of an all-out strategy to plunder big tobacco -- while keeping it alive for future plundering, of course.
"... The American public -- voters and jurors -- need to know that our legal system is rapidly becoming a tool for extortion. Sometimes the politicians seek money; sometimes they pursue a policy agenda; often they abuse their power. When Clinton was unable to persuade Congress to enact another tax on smokers, he simply bypassed the legislature and asked a federal court to impose damages in lieu of taxes. Bush can do better. Yes, he's absorbed with establishing the rule of law around the globe, but the president needs to remind his Justice Department that the campaign begins at home. It's time to call off the government's anti-tobacco crusade."
Judge Strikes Down FEC Rules
"In a stinging judgment, a federal judge in Washington struck down 15 of the FEC's recent rule interpretations as gimmicks transparently designed to undermine -- not uphold -- the campaign finance reform law of 2002. Rarely has a federal watchdog been so thoroughly rebuked," according to an editorial in today's New York Times.
However, in the Cato Handbook for Congress, Cato scholars Roger Pilon and John Samples argue that "the FEC has hardly been a pussycat in enforcing federal restrictions on campaign finance. Like most burgeoning bureaucratic empires, it has continually tried to extend its regulatory authority.
"... Not surprisingly those aggressive FEC attacks have chilled political activities at the grassroots," they write. "After all, individuals and small groups hardly have the resources to take on a bevy of specialized, zealous lawyers supported by taxpayers. The FEC represents yet another expansive federal bureaucracy that should be reined in by Congress in the near term and eliminated over the long term."
Bush Lifts Libya Sanctions
"President Bush yesterday removed a ban on commercial air service to Libya and released $1.3 billion in frozen Libyan assets in recognition of 'significant' steps to eliminate its deadliest weapons programs," the Washington Post reports.
In "What's Wrong With Trade Sanctions?" a 1985 Cato Policy Analysis, Bruce Bartlett writes: "[Sanctions] seldom accomplish their purpose, but they do often exacerbate the problems they were supposed to correct, make the United States appear to be an unreliable trading partner, and cost us foreign sales in areas unrelated to the embargo--all of which translates into reduced exports and increasing unemployment.
"Sanctions are hardly in keeping with the United States' historic role as an international leader in the effort to preserve and extend free trade. This commitment to open world markets is worth preserving, even if it costs us an occasional chance to 'punish' a government we disapprove of. Trade should not be viewed as a favor that a beneficent America bestows on other nations but rather as a thoroughly practical policy that leads to international prosperity and a reduction in tensions."
Wyatt Dubois, editor, wdubois@cato.org