Cato Institute
1000 Massachusetts Ave, NW
Washington, DC 20001-5403
Phone (202) 842 0200
Fax (202) 842 3490
 Contact Us
Support Cato

Cato Daily Dispatch for December 28, 2005

Subscribe to the Daily Dispatch via email

(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.)

Democrats Question the Department of Homeland Security
Food and Drug Administration Plagued with Problems
Shutting Off the Strategic Petroleum Reserve

Democrats Question the Department of Homeland Security

"The Homeland Security Department, created in response to the Sept. 11 terrorist attacks, has failed to fulfill 33 of its own pledges to better protect the nation, according to a report released Tuesday by House Democrats," reports The Associated Press.

"The report concludes that gaps remain in federal efforts to secure an array of areas, including ports, borders and chemical plants. There also are still delays in the department's sharing terror alerts and other intelligence with state and local officials, the review said."

Chapter 50 of the Cato Handbook on Policy says: "[T]he problem of homeland security is so vast that the [Department of Homeland Security] will be tempted to do everything. The nature of bureaucracy is to grow and to do more. This is exactly what the department needs to avoid at all costs. To be effective, the department must do everything it can to be as nimble, responsive, and adaptive as our terrorist enemy. Therefore, instead of trying to do the impossible or attempting to do everything and doing nothing well, homeland security must focus on those threats that pose the most catastrophic consequences and for which there are cost-effective defenses. First and foremost, that means not focusing on the last attack and disproportionately directing homeland security efforts against preventing the same thing from happening again."

Food and Drug Administration Plagued with Problems

"Concerns about drug safety and political meddling dogged the Food and Drug Administration in 2005," reports USA Today. "The culmination was Commissioner Lester Crawford's abrupt resignation in September, just two months after his confirmation.

"Crawford's tenure as FDA chief, which after two stints as acting commissioner added up to two years, was marked by controversy: [1.] Safety concerns led to the withdrawal of two popular arthritis drugs: Vioxx in September 2004 and Bextra in April of this year. [2.] In July and September, the FDA issued 'approvable letters' to the makers of two silicone-gel breast implants, meaning the companies can market their products as soon as they answer remaining questions. Opponents said the companies haven't studied patients long enough to prove the devices are safe. [3.] Some members of Congress held up Crawford's confirmation because the FDA had not yet allowed Plan B emergency contraception to be sold over-the-counter."

In Chapter 40 of the Cato Handbook on Policy, Michael Cannon, Cato's director of health policy studies, proposes the elimination of the FDA. He argues, instead, for a market-based certification of the safety and efficacy of initial uses of new drugs and medical devices: "It is past time for Congress to break the FDA monopoly on initial safety and efficacy certification and restore the right of individuals to control their own health care. A model for reform already exists in the private sector. The United States already has an essentially free-market process for certifying drug efficacy."

Shutting Off the Strategic Petroleum Reserve

"The United States, Europe and Japan recently stopped releasing oil and gasoline from their strategic reserves as fuel prices retreated from record post-hurricane highs," according to The Washington Times. "The United States was charged with providing half of a planned 60 million barrel-per-day release from the reserves, but neither the U.S. Energy Department nor its counterparts in Europe and Asia ended up releasing that much oil. In all, about 50 million extra barrels of oil and gasoline were released on world markets each day during the duration of the reserve program."

In the Policy Analysis "The Case against the Strategic Petroleum Reserve," Cato senior fellows Jerry Taylor and Peter Van Doren say that there is little evidence to suggest that the Strategic Petroleum Reserve (SPR) is necessary in protecting the U.S. against oil supply emergencies. They argue that the SPR has become costly and counterproductive, claiming that so far the costs of the reserve have greatly exceeded the benefits of the program and will almost certainly continue to do so in the future.

Taylor and Van Doren's research shows that as of 2004, the price of the SPR is between $42-51 billion, or roughly $64.5-79.6 per barrel of oil. Compared to the annual average world cost of oil, "the cost of the oil stockpiled in the SPR is greater than the highest annual average cost of oil ever encountered in world markets." In other words, the SPR oil is more expensive.

Greg Garner, editor, ggarner@cato.org