November 18, 2011 8:57AM

This Week at Lib​er​tar​i​an​ism​.org

This week at Lib​er​tar​i​an​ism​.org,

November 18, 2011 8:56AM

Bring It On, OWS!

This morning POLITICO Arena asks:

Has the Occupy Wall Street movement accomplished anything?

My brief response:

Has OWS accomplished anything? Yes, it’s revived the mindless, narcissistic approach to public affairs that came out of the 1960s. And I’m delighted that the mainstream media has given OWS far more sympathetic attention than it ever gave the Tea Party, because it’ll all play out in next year’s elections. March on, OWS!

November 17, 2011 3:37PM

John Mueller Joins Cato

I am pleased to announce that John Mueller, a leading scholar in the fields of political science, international relations, and national security, has joined the Cato Institute as a senior fellow.

All of us at Cato are very excited to have John as a colleague. Over the last decade as a professor of political science and as the Woody Hayes Chair of National Security Studies at the Ohio State University’s Mershon Center for International Security Studies, John has taken on the conventional wisdom in the national security arena with a rare combination of accessible, breezy prose and meticulous cost‐​benefit analysis. In particular, he has focused on how policymakers inflate national security threats at home and abroad.

His newest book, Terror Money and Security, which he presented at a recent Cato forum, examines whether the gains in security over the past decade were worth the funds expended. For the vast majority of U.S. homeland security and counterterrorism policies, John and his co‐​author, Mark Stewart, resoundingly conclude “no.”

As a member of the Cato Institute, John will contribute to our multitude of programs and publications while furthering his work on the subjects of security, defense, and U.S. foreign policy. Cato is fortunate to have such a brilliant scholar join its staff.

For more Cato Institute work on foreign policy and national security, go here.

November 17, 2011 2:30PM

Solyndra: Crooked Politics or Just Bad Economics?

Amy Harder has a good take on the Solyndra issue in National Journal Daily (subscription required):

Lesser evil: crony capitalism or bad policy?

Energy Secretary Steven Chu is about to find out when he testifies before a House panel on Thursday about the $535 million loan guarantee his department awarded to Solyndra, the now‐​bankrupt solar‐​energy company that was, before its demise, the poster child for America’s renewable‐​energy industry and President Obama’s 2009 Recovery Act.

The White House and the Energy Department say the influence of political donors such as Oklahoma oil billionaire George Kaiser, whose venture‐​capital firm was the major investor in Solyndra, did not sway any of the administration’s decisions on Solyndra’s loan guarantee, which was funded from the stimulus package.

By denying politics was involved, the administration is saying that its top officials genuinely and continuously thought Solyndra was a good bet—despite numerous warnings raised both inside and outside of the administration—and that the loan‐​guarantee program was being carefully managed despite oversight reports and an internal West Wing memo that said otherwise.

“As time went on, there was a growing concern because of the cash‐​flow,” Chu said in an interview with NPR on Tuesday. “And so we certainly were watching this and looking at this very closely. And eventually we recognized they were in deep trouble.”

Yet, throughout the two years Solyndra was borrowing money from federal coffers, the DOE essentially stayed the path right up until the bitter end when the California‐​based manufacturer went bankrupt in September. When Solyndra was on the brink of bankruptcy in late 2010, DOE decided to restructure the loan to try to keep the company afloat.

Meanwhile, in today’s congressional hearing, Energy Secretary Steven Chu insisted that “the final decisions on Solyndra were mine, and I made them with the best interest of the taxpayer in mind.… I did not make any decision based on political considerations.” This came on a day when the front page of the Washington Post reported:

In the two years preceding its collapse, Solyndra and its biggest investor aggressively asserted themselves in dealings with the Obama administration, pushing Energy Secretary Steven Chu to visit the company’s headquarters to help it raise private money and later suggesting it would file for bankruptcy if the Energy Department rejected its proposed rescue plan.…

“The DOE really thinks politically before it thinks economically,” a Solyndra board member wrote in December to George Kaiser, an Obama fundraiser whose family funds owned a third of the company.

November 17, 2011 2:01PM

Thoughts on the ‘Minibus’ Spending Bill

The House is scheduled to vote this evening on a fiscal 2012 “minibus” packaging of three appropriations bills (Agriculture, Commerce‐​Justice‐​Science and Transportation‐​HUD) agreed to in conference on Monday. It includes a continuing resolution to keep the government funded through December 16th, thus avoiding a government “shutdown.”

In sum, I think the bill is largely business as usual, although policymakers and those who subsist on the federal programs funded by the affected agencies will claim otherwise:

  • The legislation provides funding at the higher levels sought by the Democratic‐​controlled Senate – about $5.4 billion more than what the Republican‐​controlled House wanted. Overall funding versus fiscal 2011 is flat, but lower than fiscal 2010. It’s less than what the president wanted to spend, but that hurdle was so low a mouse would have tripped over it.
  • It includes $2.3 billion for disaster spending, which is excluded from the budget caps negotiated as part of the deal to increase the debt ceiling.
  • Some programs saw cuts, some programs saw increases. Anything of consequence that would rein in the size and scope of government? Not that I can see.
  • The housing lobbyists win again: the bill increases the size limit on mortgages that Federal Housing Administration can insure to $729,750. That principled decision was made at a time when a taxpayer bailout of the FHA is becoming increasingly likely.

Once again, Congress hits the snooze button.

November 17, 2011 2:00PM

Democracy — Whatever That Is — and Education

Democracy is inherently good, and since public schools are democratically controlled they, too, are inherently good. Right?

You'd think so from the way many people invoke "democracy" when championing government schools, but thanks to a recent blog post from the Fordham Institute's Mike Petrilli, we might have a rare opportunity to actually scrutinize that assumption. A few days ago, Petrilli questioned the value of local school boards in light of what seems to be frequent capture by teachers unions, and was immediately accused of attacking "democracy" by historian Diane Ravitch.

"Gosh, Mike," Ravitch wrote in the comments section, "it sounds as though you have identified the real problem 'reformers' face: democracy."

With that the battle was on, and it's one I'm happy to join: A huge problem we face in education is, indeed, democracy.

Before I go further, the first thing that's necessary to do is define "democracy." Unfortunately, that's something rarely done by those who wield the term like a rhetorical chainsaw, swinging it wildly at anyone who might question government schooling.  Typically, it seems the word is employed to just vaguely connote some sort of action by "the people" -- whoever they are -- as opposed to "elites," or to indicate that popular voting is in some fashion used to make laws.

That said, the most basic definition of democracy -- the one you probably learned in grade school --  follows these lines: "Control of an organization or group by the majority of its members." You might also assume the word means representative democracy, where people vote for their representatives and majorities of reps make the laws, but usually the word's use isn't even that precise.

Read the rest of this post »
November 17, 2011 12:48PM

Demos vs. Cato: Say No to Bailouts

Over at PolicyMic, Cato scholar Daniel J. Mitchell debates Demos co‐​founder David Callahan on whether massive government bailouts saved us from a second Great Depression, or plunged the economy into a prolonged recession that hurt taxpayers and undermined the self‐​corrective mechanisms of the market. Mitchell argues:

The Bush‐​Obama policies of bailouts and regulation have been bad for taxpayers, but they’ve also been bad for the economy.

A vibrant and dynamic economy requires the possibility of big profits, but also the discipline of failure. Indeed, capitalism without bankruptcy is like religion without hell.

Yet that’s what politicians from both parties have created. Profits are private and losses are socialized, so is anyone surprised that Wall Street responds to these incentives with imprudent risk?

Read Mitchell’s post here, and the other side here.