October 19, 2012 2:35PM

Drug Warriors Wrong on Marijuana Ballot Initiatives

Three states’ ballot initiatives might legalize the recreational use of marijuana this year. To the displeasure of some current and former drug warriors, the Obama Department of Justice is silent on the matter.

Those urging the feds to weigh in, unfortunately, rest their case on some bad reasoning:

But their claim is just not true. Here’s why. Let’s say the feds have a law banning the use of sugar in iced tea. An example of a state law that conflicts with this federal law would be one that requires the use of sugar in iced tea, not a state law that simply permits the use of sugar. A failure to adopt a law that prohibits the same thing the feds prohibit is simply not a conflict.

Another reason the Justice Department may be silent on these state ballot initiatives? President Obama is less popular nationwide than marijuana legalization.

In today’s Cato Daily Podcast, Tim Lynch goes through some of the other reasons why these drug warriors are confused on the facts.

October 19, 2012 1:35PM

Free Trade, Free Markets: Rating the Congress

With all the China bashing we’re hearing on the campaign trail and the arguments from both candidates that free trade agreements are good only because they increase manufacturing exports, one might reasonably deduce that free trade advocacy is a thing of the past and a losing position with the American people.  If this is true, many in Congress haven’t gotten the memo.  The House and Senate are home to many free traders.  You can see for yourself by visiting Cato’s interactive trade votes database, Free Trade, Free Markets: Rating the Congress.

The Cato Institute has been keeping track of how Congress votes on trade issues since 1997.  At the website you can see reports summarizing the votes for each congressional term.  There is no report for last term (2009–2010) because Congress was too busy dealing with healthcare and Keynesian stimulus to take on trade issues, but the last two years have seen votes on free trade agreements, Chinese currency and subsidies, export finance, and sugar price controls.  We’ll have a report after the current term ends on what all these votes mean for the freedom of Americans to interact with foreigners and on what to expect in the next two years.

The most enjoyable part of Free Trade, Free Markets: Rating the Congress is the ability to browse individual voting records.  For any senator or representative who has served over the last 15 years, you can see a comprehensive report card that shows what they voted for or voted against.  But they don’t just get a letter grade or percentage. 

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Each member’s record is plotted on a two dimensional graph that distinguishes between trade barriers and trade subsidies.  Many representatives and senators vote against trade barriers but in favor of trade-distorting or protectionist subsidies.  We call these folks Internationalists.  Those who vote against subsidies but favor barriers are labeled Isolationists.  Supporting both barriers and subsidies will place you in the Interventionist category, while consistent opposition to both sends you toward the venerable Free Trader designation.

The site offers excellent insight into the positions and ideologies of our elected officials, and I encourage you to investigate it at your leisure.  As a primer, I would like to point out two important observations of my own in this post.

Read the rest of this post »
October 19, 2012 1:21PM

Washington Post Sees Solar Panel Duties for What They Are: Self‐​Flagellation

The Washington Post was channeling the Cato Institute’s Herbert A. Stiefel Center for Trade Policy Studies in this morning’s succinct and insightful editorial about the foolishness of taxing imports of Chinese solar panels.

The editorial picks up a few of the themes and draws very similar policy conclusions to those we have been advocating for many years and, without stating it explicitly, presents a compelling case for major reform, if not repeal, of the trade remedies laws.

For context, last week the U.S. Commerce Department published the final rates of duty calculated in both antidumping and countervailing duty (anti-subsidy) investigations of imports of Chinese solar panels, which were initiated in October 2011. (Here are some earlier thoughts on the matter.)

Formal antidumping and countervailing duty orders will take effect, probably, next month following a final determination by the U.S. International Trade Commission that the U.S. solar panel industry has been materially injured by these Chinese imports.

The thrust of the editorial is that the antidumping and countervailing duties, which are "calculated" by Commerce using an absurdly inaccurate, punitive methodology, will hurt other U.S. companies that are downstream and upstream of the solar panel producers in the production supply chain.

Noting the transnational nature of solar panel production, the editorial states:

U.S. firms that export polysilicon, a key material in the panels’ manufacture, or machinery to Chinese solar-panel makers could lose – if not because of the direct influence of the tariffs themselves, then because of the Chinese government’s likely reaction. Analysts worry that the Chinese will retaliate by slapping duties on U.S. polysilicon. Also at risk is the U.S. solar installation business, which has thrived during this period of low-cost panels.

This is one of the critical defects of the AD/CVD regime. It focuses like a laser on assisting industries seeking protection from competition while systematically—indeed statutorily—ignoring the adverse impacts of that "assistance" on downstream U.S. industries. (Bastiat points out that people tend to err by focusing on what is immediately seen, while failing to consider the ripple effects of actions that are less readily observed; U.S. trade remedy law demands that we commit that error!)

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October 19, 2012 12:27PM

Is the Long‐​Awaited Snowfall Increase in Antarctica Now Underway?

Global Science Report is a weekly feature from the Center for the Study of Science, where we highlight one or two important new items in the scientific literature or the popular media. For broader and more technical perspectives, consult our monthly “Current Wisdom.”

Whenever the topic of rising seas comes up, we point out that Antarctica is expected to gain mass through enhanced snowfall in a warmer climate, and therefore its contribution to global sea level rise should be negative—that is, the water locked up in the added snowfall there will act to reduce the level of the globe’s seas. The models used by the Intergovernmental Panel on Climate Change (IPCC) in their 2007 Fourth Assessment Report project the sea level reduction from this mechanism by the end of the 21st century to amount to somewhere between 2 cm and 14 cm (roughly 1 to 6 inches). While this is not a lot, the main point is that Antarctica is not expected to be a contributor to rising seas as the climate warms. Without a large contribution from Antarctica, we will not approach alarmist projections of a meter‐​plus of sea level rise by century’s end.

Up to now, though, Antarctica has not exactly been with the program.

Instead of gaining mass through increased snowfall, there have been indications that Antarctica is losing ice (contributing to sea level rise) as ice discharge from its coastal glaciers exceeds gains from snow increases (which have been hard to find). One has to wonder whether Antarctica, contrary to expectations, will continue to lose mass and become an important contributor sea level rise, or whether the projected increases in snowfall have just not yet reached a magnitude sufficient to offset the loss from glacial discharge.

Things are starting to change down there.

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October 19, 2012 9:05AM

How Strong Is the Case for Big Government?

The movement for smaller government must really be doing well, considering all the attacks it has generated of late. Journalists decry “austerity” and “slashed” government spending from Athens to Albany. President Obama seems to think he’s running against people who wish that (as he put it) “everybody had their own fire service.”

That’s how my book review in the November 2012 issue of Reason begins. I take a look at two new books from impressive authors making the case for big government: To Promote the General Welfare: The Case for Big Government, edited by Steven Conn with a lot of distinguished professors, and Our Divided Political Heart: The Battle for the American Idea in an Age of Discontent, by Washington Post columnist E.J. Dionne Jr.

The professors tell a tale of a “Dickensian America” languishing in “semi‐​barbarism” (seriously) until the federal government took responsibility for dragging us out of the swamps and into civilized life. And Dionne frets that we are falling back into an era of “free‐​market fundamentalism” and a “radical form of individualism that … denigrates the role of government.”

So what’s my response? Read the review. But here’s a precis:

The case for big government should be cross‐​examined by looking at costs as well as benefits, risks as well as achievements, what is not seen along with what is seen, and the repeated horrors that have stemmed from leaving state power unconstrained.

October 19, 2012 8:25AM

The Political Novel for this Election Season

I'm a few months late on this, but while the Supreme Court was figuring out what to do with Obamacare this spring, a work of political fiction came

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out that captures the tone in Washington better than any number of Bob Woodward tick-tock tomes.  It's called Don't Mess with Travis, the fantastical tale of a homespun Texas governor facing off against an elitist president who rides roughshod over the Constitution.

[Full disclosure: The author, Bob Smiley, was a college classmate of mine, and he asked me to blurb the book, which I was happy to do because I enjoyed it so much.]

The plot, which perhaps had a bit more resonance when Rick Perry was riding high in the polls---and thus would've made the book a bestseller had Perry become the nominee---involves an unlikely state senator who finds himself governor when the two men ahead of him drive off the only cliff in the Lone Star State.  Once in power and faced with the reality of an out-of-touch White House steering the country toward a cliff of its own, Travis pursues what he sees as the only sane option: secession!

Smiley mixes the best of Carl Hiaasen with touches of George Will here, but the novel is more than just a witty blend of larger-than-life characters and prescient political narrative: it’s intelligent satire, true on both the human and policy dimensions.  The author---a Hollywood TV/film writer by day---may well become this generation’s Christopher Buckley.

In short, when you're taking a break from reading my colleagues' latest policy analyses or, of course, the Cato Supreme Court Review, I recommend Don't Mess with Travis.

October 18, 2012 4:47PM

Despite their Moral Preening, Statists Would Not Want to Live in a World without Capitalism

Part of my job is to educate people about free markets and fiscal policy.

In some cases, that means providing information and analysis to those already sympathetic to limited government. There are many people who like the idea of lower tax burdens, for instance, but they may not have given much thought to the interaction of tax rates, taxable income, and tax revenue, so that’s why I put together my Laffer Curve tutorial and why I wrote about this amazing data from the Reagan tax cuts.

A more challenging part of my job is reaching people with statist instincts. I wrote a post last week mocking an absurd example of Swedish egalitarianism, but I included some serious thoughts about why some people oppose liberty. How do I reach those people, especially when there’s some very interesting evidence showing fundamental differences in how liberals, conservatives, and libertarians see the world?

I don’t have a single answer to that question. Sometimes I use the utilitarian approach and show how capitalist nations outperform statist nations, as you can see in this comparison of North Korea and South Korea, and this post comparing Argentina, Chile, and Venezuela.

In other cases, I try a philosophical approach, one example of which is this video arguing against majoritarianism.

And sometimes I use horrifying anecdotes in hopes that people will realize the risks of unconstrained government.

But perhaps the folks at the Fund for American Studies have discovered a good way of educating statists. Take a look at this clever video.

P.S. Here’s another video from TFAS that uses an unusual tactic to get people to think about the value of capitalism and free markets.