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Cato Daily Dispatch for November 19, 2001

National ID Card Proposals Continue To Surface
IMF, World Bank Ask For More Aid
States Look To Hike Taxes

National ID Card Proposals Continue To Surface

With popular support for a national identification system gaining ground in the wake of Sept. 11, Congress again is being forced to debate an idea it has entertained and rejected numerous times over the years.

At a House Government Reform subcommittee hearing on the matter today, Ranking Democrat Janice Schakowsky, Ill., said Sept. 11 demonstrated that a national ID system would not have stopped the terrorist attacks, according to The Washington Post.

"The events of Sept. 11 show us that systems like national identification cards will not deter the crazed terrorist from his or her mission," she said.

Instead of providing meaningful solutions to terrorism, national ID cards will become at best an unnecessary nuisance for most citizens. In extreme cases, they could produce massive breaches of individual privacy, argues Cato scholar Adam Thierer in "National ID Cards: New Technologies, Same Bad Idea."

Cato's Tim Lynch was on CNN's Moneyline recently discussing the various proposals for a national identification card program. Video of the show is available online.

IMF, World Bank Ask For More Aid

The International Monetary Fund and World Bank wrapped up a weekend meeting today with fresh calls for increasing aid to developing countries, but resistance to the idea by the United States raised doubts about how much new assistance would be forthcoming, according to The Washington Post.

A "substantial increase" in current levels of official development assistance would be required in coming years, the World Bank's policy-setting development committee said in a statement. The bank's president, James Wolfensohn, said support among panel members for a major increase in aid was the highest he had ever seen.

The Cato Handbook for Congress calls for the withdrawal of the United States from the IMF because it "does not appear to have helped countries either to achieve self-sustaining growth or to implement market reforms." In the Cato book "Perpetuating Poverty: The World Bank, the IMF, and the Developing World," editors Doug Bandow and Ian Vasquez analyze the moral hazard created by these institutions when they make poor countries dependent on Western bailouts.

States Look To Hike Taxes

With their finances rapidly souring, several states are considering reversing course and raising taxes after a seven-year run of tax cuts, according to the Associated Press.

On Thursday, Nov. 15, Indiana Gov. Frank O'Bannon (D) went on statewide television to call for budget cuts and increased taxes to overcome a fiscal crisis that ``threatens our very way of life.'' Virginia Gov. Jim Gilmore (R) announced he won't be able to fulfill a campaign promise and eliminate a much-hated tax on cars and trucks.

There are also proposals for new taxes in Alabama, Wyoming, Tennessee, and Washington state.

In "The Case against a Tennessee Income Tax," and "Tennessee Should be Cutting Taxes, Not Raising Them," Stephen Moore and Richard Vedder explain that an income tax would have negative consequences for Tennessee's economy.

In "Keep the Car Tax Promise," Morre writes that, "the idea that Virginia can't find the money to balance the budget and repeal the car tax at the same time is absurd and even insulting."