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Cato Daily Dispatch for November 21, 2002

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(Links to outside sources were active as of the date of this dispatch; however, not all news sources maintain links to current stories indefinitely. Some links also may require registration.)

Pentagon Snooping Proposal Likely to Violate the Fourth Amendment

The Pentagon yesterday confirmed that a high-tech data-collection system that will monitor credit card transactions and airline ticket purchases, described by critics as "a supersnoop's dream," is being created to thwart terrorist attacks, according to The Washington Times.

Edward Aldridge, undersecretary of defense for acquisition and a retired Navy admiral, said the program, Total Information Awareness (TIA), is an "experimental prototype" that will attempt to search "vast quantities of data to determine links and patterns indicative of terrorist activities."

The program will fund research and development of technologies that will allow the federal government to track the e-mail, Internet use, travel, credit card purchases, phone, bank records and every type of available public and private data in what the Pentagon describes as one "centralized grand database."

"The TIPS program proposed by the Justice Department that would have made us a nation of snitches was bad enough. This is much worse -- it will make us a nation of suspects," Cato Senior Defense Policy Analyst Charles Peņa said in a statement released last week. "In its zeal to give the illusion of homeland security and trying to catch terrorists, the federal government will instead create a surveillance state to spy on its own citizenry. And in casting a wide net, such action will likely violate the guarantee of the Fourth Amendment for 'people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures.'"

"The first responsibility of the federal government is to protect its citizens, but not at their expense. In the name of homeland security and defending against terrorism, the ends do not justify the means," Peņa said.

Free College Education to Everyone Who Works 10 Hours a Week

USA Today reports that Sen. John Edwards (D-N.C.), joining what Democrats say will be an "ideas primary" among presidential hopefuls, today will propose a government program to pay the first year's college tuition for a student who also works 10 hours a week at a job or community service.

Additionally, he'll put forward plans to offer four-year, full-tuition scholarships to students who agree to teach in hard-pressed schools or work in homeland security for five years after graduation.

In a forthcoming Cato Institute Policy Analysis, Miguel Palacios of the Batten Institute offers up another option for financing a college education. He explains the benefits of using human capital contracts rather than student loans or financial aid to pay for higher education, and argues that "the introduction of human capital contracts could transform the way in which colleges and universities currently fund themselves and their financial aid offices."

"Under a human capital contract, a student receives funding in exchange for a percentage of his or her income during a fixed period of time," Palacios writes in "Human Capital Contracts: Equity-like Instruments for Financing Higher Education." "Human capital contracts are equity-like instruments because the investor's return will depend on the earnings of the student, not on a pre-defined interest rate. The effects of these arrangements are, among others, less risk for the student, transfer of risk to a party that can manage it better, increased information regarding the economic value of education, and increased competition in the higher education market."

Canadian Official: Less Privatization, More Tax Dollars Will Fix Health Care System

Canadian Health Commissioner Roy Romanow yesterday criticized the Canadian government for skimping on Medicare and provinces such as Ontario for promoting what he called the "panacea" of privatization, reports The Toronto Star.

The former Saskatchewan premier said Ottawa has no choice except to put up more cash if Medicare is to be fixed and expanded into new, needed areas, such as home care and drugs.

"The system does need more money if it is to meet today's needs and if it is to successfully transform itself for the future," Romanow told an audience of about 550 at the Winnipeg Canadian Club yesterday. "In my view, the suggestion that greater private-sector participation in our health care system is the answer to the problems of timely access and wait lists, with the greatest of respect, defies logic."

In "Health Care Reform: The Good, the Bad, and the Ugly," a 1994 Cato Institute Policy Analysis , Michael Tanner, Cato's director of health and welfare studies, explains the perils of a healthcare system like Canada's:

"Surgeons in Canada report that, for heart patients, the danger of dying on the waiting list now exceeds the danger of dying on the operating table. According to Alice Baumgart, president of the Canadian Nurses Association, emergency rooms are so overcrowded that patients awaiting treatment frequently line the corridors. Countries with national health care systems also lag far behind the United States in the availability of modern medical technology. It is well documented that in Canada, high-technology medicine is so rare as to be virtually unavailable."

Wyatt Dubois, editor, wdubois@cato.org