March/April 2007

Cato Studies: Nuclear Iran, Data Mining, Measuring Markets, Inequality, and Social Division

Can We Deter a Nuclear Iran?

If and when Iran successfully develops nuclear weapons, how should the United States respond? In "The Bottom Line on Iran: The Costs and Benefits of Preventive War versus Deterrence" (Policy Analysis no. 583), Cato foreign policy analyst Justin Logan disputes the notion that military strikes would be the best option. Intelligence about Iraq's weapons programs turned out to be flawed, and information about the location and nature of Iran's nuclear facilities looks even sketchier, Logan argues. He further explains how preventive war against Iran is not only unlikely to succeed but also carries enormous costs: Iran would be likely to respond to a U.S. attack, and there would be a host of unintended consequences inside and outside Iran. Fortunately, Logan finds that the Iranian government's past behavior shows it would be deterred if the United States made clear that any improper use of its nuclear weapons would be met with a devastating response. Logan concludes that a policy of deterrence can deal with Iran's nuclear threat while avoiding the catastrophes that would result from military strikes.

Mine Your Own Business

Since September 11, 2001, much has been said about whether or not we should give up some liberty for more security. But Jeff Jonas, an engineer and scientist with IBM's Entity Analytic Solutions Group, and Jim Harper, director of information policy studies at Cato, argue that, in the context of data mining, a proposed method for finding terrorists, the assumed tradeoff between liberty and security is false. In "Effective Counterterrorism and the Limited Role of Predictive Data Mining" (Policy Analysis no. 584), Jonas and Harper explain how using data mining, the process of searching data for known patterns and using those patterns to predict future outcomes, to catch terrorists would be a misdirection of precious national security resources because of the high probability of false positives and other problems. Their study reveals that sifting through the personal data of thousands of Americans in an attempt to find the patterns of terrorists takes away important liberties without making us any safer.

Measuring Markets

Andrew Coulson, director of the Center for Educational Freedom at Cato, defines a free market in education as "a system that provides the freedom for producers and consumers to voluntarily associate with one another, as well as the incentives that encourage families to be diligent consumers and educators to innovate, control costs, and expand their services." "The Cato Education Market Index" (Policy Analysis no. 585) objectively measures school systems in the 50 states in terms of how conducive they are to the rise of competitive marketplaces. Unsurprisingly, Coulson finds that the U.S. education system has a long way to go to become a free market. But with "the Cato Education Market Index," he hopes to provide a tool to inform policymakers about the conditions necessary to bring about real competition in education.

Lies, Damned Lies, and Inequality

Editorial headlines announce that we are living in a "new gilded age." Paul Krugman writes of "a stunning increase in inequality throughout the U.S. economy" over the past 30 years. Democrats now use the assumption that income inequality is growing as the basis for such policies as raising the minimum wage. In "Has U.S. Income Equality Really Increased?" (Policy Analysis no. 586), Cato senior fellow Alan Reynolds argues that the problem with the federal income tax return data used to support those claims is that they're not measuring what they claim to be measuring. Large changes in U.S. tax rules in recent decades raise the share of reported incomes at the top. As Reynolds explains, those changes make it meaningless to compare income data from the 1970s and 1980s with more recent data. He finds that the real story on inequality is not about a "new gilded age" but about misleading statistics.

Today's Lesson: Social Division

In the 1800s Catholics and Protestants came to blows over which version of the Bible would be taught in public schools. And groups continue to use the public schools to try to force their moral agendas on other people today, as Neal McCluskey, policy analyst at the Center for Educational Freedom at Cato, demonstrates in "Why We Fight: Do Public Schools Cause Social Conflict?" (Policy Analysis no. 587). He uncovers 150 incidents of social conflict from the 2005–06 school year alone. A school district in Dover, Pennsylvania, required biology students to hear a disclaimer that evolution is just a theory. A student at a California high school was reprimanded for displaying an American flag from her back pocket. The Nebraska legislature split Omaha's school district down racial lines. McCluskey uses those and many other examples to illustrate that clashes are inevitable in a system in which all Americans are required to support public schools, but only those with the most political power control them. As an alternative, McCluskey advocates empowering individual parents to select schools that share their moral values and educational goals.

This article originally appeared in the March/April 2007 edition of Cato Policy Report