October 2013

October 31, 2013 6:43PM

Supporting Individual Rights, Opposing Eminent Domain Abuse

A recent blogpost published by Doug Kendall of the Constitutional Accountability Center (with whom we sometimes work with on op‐​eds and briefscriticized Cato’s involvement in Mount Holly v. Mount Holly Gardens Citizens in Action as cowardly, and inconsistent with our ideals. While Cato has great respect for any organization that, like the CAC, works “to preserve the rights and freedoms of all Americans,” their criticism of our brief is baseless, and grossly mischaracterizes Cato’s position in the case and track record generally. 

While I’m wary of misrepresenting the post through over‐​simplification, it can be boiled down to the following: 

  1. Mount Holly is a case about eminent domain;
  2. Pro‐​property rights groups (including Cato) have a history of “howling” against eminent domain;
  3. Those groups’ failure to argue against eminent domain in this case (and their support of the Township of Mount Holly), is inconsistent with their previous stance on property rights, and evinces a lack of moral courage;
  4. That failure can be explained because this case is also about civil rights and equality, and conservative groups hate equality, and live to help the state further oppress the downtrodden masses. 

CAC’s criticism stems from an incorrect framing of the case at hand:

an important case out of Mount Holly, New Jersey, that involves Fair Housing Act (FHA) claims in the context of an effort by Mount Holly Township to use eminent domain to redevelop its only predominately minority community—and in the process, displace and raze the homes of its residents.

While that description is accurate in that the case is important, originates in Mount Holly, and concerns the applicability of the Fair Housing Act to a redevelopment plan, the case before the Supreme Court has nothing to do with eminent domain. The question to be argued before high court couldn’t be plainer: “Whether disparate impact claims are cognizable under the Fair Housing Act.”

It’s surprising that CAC would make such a basic mistake about the case, given that they filed a brief in the case, supporting the Mount Holly residents (a brief which makes no mention of eminent domain — at all).

“Eminent domain” refers to a specific way that the government can acquire private property against the will of the owner. So far, Mount Holly Township hasn’t resorted to eminent domain. Of the 329 properties that the township wants to include in the redevelopment plan, it has been able to acquire all but 70 of them through voluntary sales. If those remaining 70 owners — some of whom are parties to the case — were to challenge any attempts to expropriate their homes, Cato would be first in line to file a brief in their support, probably joined by those “howling” pro‐​property groups like the Institute for Justice and Pacific Legal Foundation. (Sadly, it’s unlikely that we would garner CAC’s support, because the group has “long supported the reasonable use of eminent domain for redevelopment purposes.”)

No, this case isn’t about eminent domain because the residents aren’t challenging the township’s acquisition of property, but what it intends to do with that property. In a nutshell, the plaintiffs argue that the Fair Housing Act — which forbids governments and private individuals from refusing “to sell or rent … or otherwise make unavailable or deny, a dwelling to any person because of race, color, religion, sex, familial status, or national origin” — bars not just intentional discrimination like restrictive covenants, but also any action that, even if entirely neutral and colorblind, has a “disproportionate impact” on the ability of members of a protected class to buy or rent a home. They argue not that Mount Holly is intentionally discriminating against minority residents, but that the increase in property values as a result of redevelopment would effectively price the poor out of the neighborhood — and that counts as discrimination because the poorer residents are disproportionately drawn from minority groups

Cato opposes that theory of law generally, for the same reason that we oppose governmental abuse of eminent domain: we stand firmly against attempts by the government to control how people may dispose of their property. A homeowner should be able to sell his house for whatever price he thinks fair — without worrying that if his asking price is too high, he’ll be accused of racism and forced to defend himself in court. Our position in Mount Holly is the product of the reasoned and consistent application of well‐​articulated liberal principles, not “cowardice.”

As a closing note, we take issue with the implication that Cato “detests civil rights statutes.” Cato supports laws that protect individual freedom and opposes those that don’t. We may disagree with CAC on whether a law falls in the first or second category, regardless of whether it’s a “civil rights” statute or otherwise, but make no mistake that we support individual civil (and other) rights.

Indeed, we believe that the first and foremost duty of civil rights legislation (and constitutions) is to protect citizens from undue state interference with their daily lives and liberties. A reading of the FHA that embraces disparate impact claims doesn’t protect individuals from the state but instead represents an expansion of state interference. Behavior that was once lawful — selling your home for whatever price you wish — would become sanctionable. Disparate impact theory holds private individuals responsible not for personal bigotry, or the direct consequences of their actions, but for economic realities beyond their control — and that makes no one freer, nor more equal.

Update: Repeating what happened in the previous disparate‐​impact FHA case, Magner v. Gallagher, this case has apparently settled. The only question now is what the administration did to keep this issue away from the Supreme Court again. 

Further update: A couple of readers familiar with the facts on the ground in Mount Holly point out that while it’s technically correct that Mount Holly “hasn’t resorted to eminent domain,” the town’s redevelopment plan is indeed all‐​too‐​typical of eminent‐​domain abusers. That is, while not employing eminent domain – no condemnation proceedings have (yet) been filed – the town threatened to use it and then claimed “voluntary” sales when the homeowners capitulated. The redevelopment authority has represented that the incentives it offered for relocation were greater than what homeowners would’ve gotten from the eminent domain process – that alas is probably true, because the compensation paid for government takings is rarely “just” – but of course they would’ve had to sweeten the deal even more if they couldn’t threaten eminent domain in the first place. In other words, as we and our pro‐​property‐​rights allies have long argued, the ultimate solution is to reverse Kelo v. New London and take away the government’s ability to forcibly transfer property from one private party to another. If such eminent‐​domain‐​abuse claims aren’t foreclosed by the Mount Holly settlement, I suggest that the town’s residents hire IJ to litigate them. Cato would look forward to filing an amicus brief in support.

This blogpost was co‐​authored by Cato legal associate Gabriel Latner.

October 31, 2013 6:35PM

The NSA Fig Leaf Act of 2013

Just in time for Halloween, the Senate Intelligence Committee has produced fig‐​leaf legislation that entrenches indiscriminate collection of Americans’ phone and Internet records, but dressed it up in the costume of a surveillance reform bill designed to ban such collection. The “FISA Improvements Act” does contain some mild but generally positive transparency measures—somewhat ironically, given that the bill itself was marked up in secret. But the main provision deals with the NSA’s controversial bulk phone records program. According to the extraordinarily misleading press release, the law:

Prohibits the collection of bulk communication records under Section 215 of the USA PATRIOT Act except under specific procedures and restrictions set forth in the bill

This is almost precisely backwards. In fact, the bill for the first time explicitly authorizes, and therefore entrenches in statute, the bulk collection of communications records, subject to more or less the same rules already imposed by the FISA Court. It endorses, rather than prohibits, what the NSA is already doing. Moreover, it imposes those restrictions only with respect to bulk collection of communications records—which is dangerous, because it signals to the FISA Court that Congress implicitly endorses the use of Section 215 to collect other records in bulk without comparable restrictions. (The key phrase “acquisition in bulk,” incidentally, does not appear to be given any concrete definition.) 

Perhaps most troubling, the bill contains a section stipulating that bulk orders for communcations records may not acquire the contents of any communications. That sounds good, right? The problem is, under canons of judicial interpretation, a narrow and explicit prohibition on getting content under bulk orders for communications records could easily be read to imply that content can be acquired via non‐​bulk orders, or even via bulk orders for other types of records. At present, it is not clear whether the statute allows for the acquisition of contents under 215, but there are strong arguments it does not—though, of course, I’d argue the Constitution would forbid this even if the statute didn’t. Under this law, though, a clever Justice Department lawyer could plausibly argue that a prohibition on content collection under one very specific type of 215 order would be senseless and redundant unless Congress intended for content to be accessible under 215 orders generally—and Courts generally have to interpret the law in a way that avoids making any provision redundant.

This is not at all a hypothetical concern. In 2006, Congress amended Section 215 to add special “protections” for educational and medical records. What Congress didn’t know is that, because those records are already protected under other federal laws, and 215 contained no language explicitly overriding those statutes, the Justice Department had determined that 215 simply could not be used to access those types of records—an interpretation that was reversed after the “protections” were added. Congress, in other words, inadvertently expanded the scope of 215 while trying to limit it—a fact that was discovered only later, when a report by the Inspector General revealed the unintended consequences of the amendment.

This bill bears out the prediction Sen. Ron Wyden made in his keynote speech at our recent NSA conference:

[W]e know in the months ahead we will be up against a “business‐​as‐​usual brigade” – made up of influential members of the government’s intelligence leadership, their allies in thinktanks and academia, retired government officials, and sympathetic legislators. Their game plan? Try mightily to fog up the surveillance debate and convince the Congress and the public that the real problem here is not overly intrusive, constitutionally flawed domestic surveillance, but sensationalistic media reporting. Their end game is ensuring that any surveillance reforms are only skin‐​deep.

The business‐​as‐​usual brigade have resigned themselves to the inevitability of some kind of NSA reform—but they’re clearly hoping some cosmetic changes, falsely billed as a “prohibition” on bulk collection, along with a few mild transparency tweaks, will preempt any more substantive reform. It’s an ingenious costume, but most assuredly more trick than treat.

October 31, 2013 5:16PM

We’re Shocked at the Actions of the Agency We Rigorously Oversee!

Rigorous Oversight by All Three Branches!

That tune you hear is the sound of an ice cream truck arriving in Hades: Following vigorous denials that President Obama knew anything about U.S. eavesdropping on German Chancellor Angela Merkel or other allied leaders, Sen. Dianne Feinstein (D-NSA), has issued a blistering statement calling for a comprehensive review of intelligence programs:

Unless the United States is engaged in hostilities against a country or there is an emergency need for this type of surveillance, I do not believe the United States should be collecting phone calls or emails of friendly presidents and prime ministers. The president should be required to approve any collection of this sort. 

It is my understanding that President Obama was not aware Chancellor Merkel’s communications were being collected since 2002. That is a big problem. 

The White House has informed me that collection on our allies will not continue, which I support. But as far as I’m concerned, Congress needs to know exactly what our intelligence community is doing. To that end, the committee will initiate a major review into all intelligence collection programs.

As many have noted, it’s a little odd that surveillance of a foreign leader is more disturbing to Feinstein than bulk collection of her own constituents’ information. In part, Feinstein simply seems displeased that she wasn’t apprised of the surveillance—reminding us that perhaps the only really unforgivable intelligence sin is failing to show proper respect to a committee chair.

It’s also a recognition of the serious problems posed by international blowback against NSA’s overreach. American intelligence agencies have long benefitted enormously from the fact that foreign Internet traffic—even between two foreign countries—flows through the United States, and that American Internet services and Web hosts are extremely popular with foreign users and companies. Now, Brazil and other countries are mulling legislation that would require data be stored in their own jurisdictions, along with limitiations on intelligence sharing. 

Beyond the economic harms this would impose—one recent study estimates the potential losses to American cloud computing firms at up to $35 billion over three years—it’s clearly contrary to the interests of the intelligence community itself to lose that access. It’s another reminder that the flourishing global Internet depends, to a great extent, on trust—and we may be starting to see the long‐​term consqeuences of undermining that trust.

Above all, though, it reminds us again that frequent claims that NSA’s activities are subject to “rigorous oversight by all three branches of government” really just mean that the Intelligence Committees get a fairly limited and rosy view of whatever programs the intelligence community sees fit to brief them on.

The global surveillance apparatus is so vast and complex that Congress, the FISA Court, and even the NSA itself cannot really hope to comprehend the entire system. As Director of National Intelligence James Clapper once told Congress, “There’s only one entity in the universe that has visibility on all [Special Access Programs]: That’s God.” Which, presumably, makes the Almighty a security risk: Recent reports allege that NSA has been wiretapping the pope as well.

October 31, 2013 3:04PM

Common Core: “If You Like Your Curriculum, You Can Keep Your Curriculum”

Common Core’s primary backers have been assuring us for years that the standards do not mandate any specific curriculum or prescribe any particular method of teaching. However, now that states have begun to implement Common Core, those same backers are singing a different tune. Professor Jay P. Greene highlighted the shift at the Education Next blog. For example, just six months ago, prominent Common Core supporters Kathleen Porter‐​Magee and Sol Stern wrote in National Review Online:

Here’s what the Common Core State Standards do: They simply delineate what children should know at each grade level and describe the skills that they must acquire to stay on course toward college or career readiness. They are not a curriculum; it’s up to school districts to choose curricula that comply with the standards.

However, now Porter‐​Magee and Chester Finn of the Fordham Institute argue that the standards must change “classroom practice”:

In order for standards to have any impact, however, they must change classroom practice. In Common Core states, the shifts that these new expectations demand are based on the best research and information we have about how to boost students’ reading comprehension and analysis and thereby prepare them more successfully for college and careers. Whether those shifts will truly transform classroom practice, however, remains to be seen.

What sort of changes will that entail? Well, for one, Common Core uses “lexiles,” which measure things like sentence length and vocabulary to rate the complexity of a text, to determine which books are suitable for each grade level. As Professor Blaine Greteman points out at The New Republic, the simplistic lexile scores absurdly conclude that “The Hunger Games” is more complex than “Grapes of Wrath” and that Sports Illustrated for Kids is more complex than “To Kill a Mockingbird.” Greteman concludes, “Lexile scoring is the intellectual equivalent of a thermometer: perfect for cooking turkeys, but not for encouraging moral growth.”

As Greene notes, the change in tune concerns not only the impact on curriculum, but also whether Common Core prescribes a given manner of teaching: 

The National Council on Teacher Quality, with support and praise from the Fordham Institute, are grading teacher training programs on whether “The program trains teacher candidates to teach reading as prescribed by the Common Core State Standards.” Wait. ”Prescribed?” I thought Common Core didn’t prescribe pedagogy. But that was back when I was young and we were dating.

It would be nice if Fordham and others trying to hold down the right flank of the Common Core advocacy campaign could keep their story straight. The switch once the fight has shifted from adoption to implementation creates the impression that these folks make whatever argument they think will help them prevail in the current debate rather than relying on principle, evidence, and intellectually serious policy discussion.

[Hat tip to Greg Forster of the Jay P. Greene Blog for the title of this post.]

October 31, 2013 11:52AM

‘There Is No Such Thing as an Individual Mandate. It’s a Tax.’

That’s what Department of Justice attorney Joel McElvain said in open court last week. And thus the Obama administration reversed itself once again on whether the individual mandate is a tax. 

Relatedly, a Clinton‐​appointed federal judge has dealt a second blow to the IRS and the credibility of its defenders. He called one of the administration’s arguments ‘silly,’ and promised expedited consideration of the Obamacare challenge, Halbig v. Sebelius. Read all about these in my latest Darwin’s Fool post at Forbes​.com.

October 31, 2013 11:33AM

Is It Too Easy to Start Private Voucher Schools?

Interesting story today in Wisconsin’s Journal Times about the ease with which someone can start a private school with state voucher funding:

[as] the system works now, a new voucher school can enroll children after simply attending a short fiscal training session, writing the state a $900 check and filling out a few simple forms.“You basically fill out a letter of intent. There’s not much else there,”

Low barriers to entry are crucial to a well‐​functioning market; they allow people with new and innovative ideas to easily offer their services to the public. This, in fact, is how economic progress often takes place—not by the incremental improvement of existing providers, but rather the entry of new ones.

But “low” is a relative term. If your business requires any up‐​front capital at all you have to put your own money on the line, find willing investors, or both. Entrepreneurs typically don’t or can’t do that without first developing a sound business plan and convincing banks and other investors of their ability to execute it. And once they’ve begun operating, entrepreneurs still have to earn the public’s trust. People can be leery of dealing with new companies they’ve never heard of.

Not only can voucher schools be started with less up‐​front due diligence, they also get the government’s seal of approval absolutely free. What difference does that make?

For instance, a weekend Journal Times story explained how a student lost her voucher spot when St. John Fisher, 2405 Northwestern Ave., closed in 2012 after its first year in operation when it ran out of money.

Kandy Helson, whose daughter went to the now‐​defunct school, said she thought the school was sound because the state put it on a list of participating voucher schools in February. She didn’t know how little is actually known about participating schools when the list gets released.

Naturally, the solution is to impose a whole bunch of quality‐​assurance regulations on new vouchers schools, right? That’s certainly the answer that many people would give. But, of course, traditional public schools are absolutely coated in such regulations and their productivity has collapsed over the past 40 years.

So how do we ensure universal access to the education marketplace without facilitating the creation of poorly managed schools? One way is to provide low‐​income parents with financial assistance from an array of different private scholarship granting organizations (SGOs)—organizations that must compete with one another to attract philanthropic donations and to attract families seeking assistance. In order to appeal to donors, these organizations would have to show that they are truly helping low‐​income families and not throwing their money at mismanaged schools.

This is precisely the sort of system that arises under well‐​designed scholarship donation tax credit programs. Under those programs, businesses and/​or individuals can donate to the SGO of their choice, and they receive a tax cut in the amount of the donation (or close to it). Just as normal charitable organizations have to compete to attract donors’ interest, so do SGOs, and this gives them an incentive not to fund badly‐​managed schools. A dozen or so states already have such programs, including Pennsylvania and Arizona.

October 30, 2013 4:40PM

Launch of Human​Progress​.org

I am happy to announce the launch of www.humanprogress.org. I hope that it becomes a trusted resource for students, journalists and the public in general.

Those who were not able to join us today will be able to see the video from the launch conference on our events page soon.

We heard a wonderful contribution from Robert Zoellick, the former World Bank President, as well as two very distinguished journalists, Ronald Bailey from Reason and Robert Samuelson from Washington Post.

In the meantime, please check out some of the cool charts and calculations that you will be able to make and share with your friends by using www.humanprogress.org.

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