Archives: 12/2015

The Koreas Should Talk, and Talk Some More

The two Koreas recently chatted at Panmunjun, the truce village within the Demilitarized Zone. They reached an agreement - to talk some more, starting on Friday.

That’s the way it usually is. When there’s a specific issue that must be resolved, real results sometimes are reached. But promises of future talks usually fall short.

Will this time be any different? The two sides scheduled talks with vice ministers for December.

Even if the discussions actually occur, the agenda remains unclear. The joint statement pointed to “issues that will improve relations between the South and the North.”

But those issues, of which there are many, rarely have been susceptible to settlement via negotiation. Most problems on the peninsula grow out of the North Korean regime’s determined misbehavior.

Topping the list for the South was family reunions, or “divided families,” according to MOU spokesman Jung Joon-hee. Visits are a fine humanitarian gesture, but irrelevant to the larger geopolitical conflict.

Jung said at their meeting the so-called Democratic People’s Republic of Korea focused on restarting tours of its Mount Kumgang resort. But they were suspended years ago after a North Korean guard shot and killed a tourist who wandered into a forbidden area.

Good Bye NCLB, Hello ESSA

President Obama has just signed the Every Student Succeeds Act, ending the era of No Child Left Behind. If nothing else, that big majorities of both parties in Congress felt the need to greatly ease federal force in elementary and secondary education – at least overt federal force – is a powerful testament to the breadth of the public backlash against federally driven standardization, testing, and “accountability.” That backlash may well have hit a tipping point thanks to the Common Core, through which the federal government attempted to get states not just to have state curriculum standards and tests, but national standards and tests. In other words, Washington began to influence the specifics of what children across the country would learn.

Is the ESSA much better than NCLB? No, and it could potentially end up taking very little power away from Washington even though the language surrounding it has been all about returning authority to states and districts. But that the rhetoric about the federal role has had to change so greatly is a very encouraging thing.

Of course, the work of getting Washington to obey the Constitution by getting out of education – and of fundamentally changing the education system to one based in freedom – is nowhere near complete. But at least things may be heading in the right direction.

Dumping Money on Fire

A bill before Congress would practically give the Forest Service a blank check for firefighting. HR 167, the Wildfire Disaster Funding Act, proposes to allow the Forest Service to tap into federal disaster relief funds whenever its annual firefighting appropriation runs out of money. It’s not quite a blank check as the bill would limit the Forest Service to $2.9 billion in firefighting expenses per year, but that’s not much of a limit (yet), as the most it has ever spent was in 2006 when it spent $1.501 billion.

The Forest Service puts out fires by dumping money on them.

Having a blank check is nothing new for the Forest Service. In 1908, Congress literally gave the agency a blank check for fire suppression, promising to refund all fire suppression costs at the end of each year. As far as I know, this is the only time in history that a democratically elected legislature gave a bureaucracy a blank check to do anything: even in wartime, the Defense Department had to live within a budget.

Due to rising firefighting costs, Congress repealed the Forest Service’s blank check in about 1978, giving the agency a fixed amount each year and telling it to save money in the wet years to spend in the dry years. The agency actually reduced its costs for about a decade, but then two severe fire years in 1987 and 1988 led the Forest Service to borrow heavily from its reforestation fund. Congress eventually reimbursed this fund, and costs have been growing ever since.

In the 1970s, when firefighting costs were so out of control that Congress repealed the blank check, the agency spent about 10 to 20 percent of its national forest management funds on fire. Today, even though the agency’s budget has kept up with inflation, more than half goes for fire.

Yet there is some restraint on what the agency spends. In severe fire years, it has to borrow money from its other programs, putting a crimp in those activities. Congress eventually reimburses that money, but in the meantime fire managers are aware that their spending is having an impact on other agency projects.

Happy Human Rights Day

Today is Human Rights Day, a time we should celebrate great advances in human freedom through history—the rise of the rule of law, the abolition of slavery, the spread of religious liberty, the secular decline of violence, respect for free speech, etc.—as well as honor those groups and individuals working to promote or safeguard human rights in the many parts of the world they are currently being violated or threatened.

At Cato, we have been honored to host and work with human rights champions from around the globe, all of whom have suffered persecution for speaking truth to power. The list includes renowned Soviet dissident Vladimir Bukovsky, independent Cuban blogger and journalist Yoani Sanchez, Malaysian politician and former deputy prime minister Anwar Ibrahim, Venezuelan opposition leader Maria Corina Machado, Russian liberty advocate Garry Kasparov, Chinese activist  Chen Guangcheng (sometimes known as the blind, “barefoot lawyer”) and many more.

Because we believe in the inherent dignity of individuals, human freedom is worth defending. For that reason, and because freedom plays a central role in human progress, it is also worth gaining a better measure and understanding of the spread of,  and limitations on, freedom around the world. That’s why we created the Human Freedom Index in conjunction with the Fraser Institute and the Liberales Institute. The index is the most comprehensive global measure of civil, personal and economic freedom so far devised. And although Human Rights Day technically commemorates the Universal Declaration of Human Rights, we think the Human Freedom Index and its definition of freedom—the absence of coercive constraint—can help us think more carefully about the state of freedom around the world.

You may view the index here, see how countries and regions of the world rank, examine how income and democracy relate to freedom, get a sense of how various freedoms relate to one another, and otherwise gauge how the world is doing on 76 distinct indicators.

Other Cato activities and publication that may be of interest on Human Rights Day include:

Recent events

“The Deteriorating State of Human Rights in China”

“Property Rights Are Human Rights: Why and How Land Titles Matter to Indigenous People”

“Islam, Identity, and the Future of Liberty in Muslim Countries”

“Magna Carta and the Rule of Law around the World”

“The Moral Arc: How Science and Reason Lead Humanity toward Truth, Justice and Freedom”

Publications

The Tyranny of Silence by Flemming Rose

The Power of Freedom: Uniting Human Rights and Development by Jean-Pierre Chauffour

Realizing Freedom by Tom Palmer

“Islam and the Spread of Individual Freedoms: The Case of Morocco” by Ahmed Benchemsi

“Capitalism’s Assault on the Indian Caste System,” by Swami Aiyar

“Magna Carta’s Importance for America,” by Roger Pilon

When Foreign Liberals Are Generous with American Lives and Money

Before becoming wedded to statism in America, liberalism was a philosophy of liberation. But while leading liberals of the past advocated peace, many foreign (“classical”) liberals today favor war—at least, if conducted by America.

For instance, former chess champion Garry Kasparov has taken on the heroic but thankless task of battling for democracy in his Russian homeland. Alas, he also is surprisingly generous with other people’s lives. He recently declared: “Anything less than a major U.S. and NATO-led ground offensive against ISIS will be a guarantee of continued failure and more terror attacks in the West.”

Kasparov is confused over cause and effect, since terrorism most often follows intervention, as did the recent Islamic State strikes against France, Hezbollah and Russia. But there is a more basic point.

It’s easy for a celebrity Russian living in the West to argue that it is the job of Americans, with maybe a couple Europeans tossed in, to destroy ISIS, save Syria, and more. But there’s actually nothing liberal in pushing a broader, longer war on others.

Kasparov is not alone. A number of foreign liberals—Lithuanian, Russian, Slovakian, Swedish, for instance—have criticized American libertarians for advocating a non-interventionist foreign policy. They’ve instead argued that a “compelling” argument can be made for a “globalist” strategy.

Actually, that’s true only so long as one isn’t paying the cost of the foreign policy. As foreigners typically do not for American intervention, unless it is directed at them.

Excessive Fines Are Unconstitutional

Fool me once, shame on you; fool me twice, shame on me. In this case, the Palmetto State, following the lead of other state and federal regulators, has added a new twist to that old saying: fool no one, pay $124 million to the treasury.

Ortho-McNeil-Janssen (“Janssen”) is a pharmaceutical company that distributes a popular antipsychotic drug known as Risperdal. In the 1990s and early 2000s, Risperdal was in fierce competition for market dominance and made some questionable claims about the drug’s side effects. The FDA investigated and compelled the company to correct some defective warning labels.

South Carolina regulators, however, despite the FDA’s settlement of the matter, commenced state action against Janssen under the state’s Unfair Trade Practices Act. That action worked its way up to the state supreme court, which ultimately confirmed a $124 million penalty against the company. That massive fine was sustained on the theory that each labeling violation was its own violation of the statute, worth up to $5,000 each, rather than the overall labeling violation counting as one singular misdeed.

Such a large penalty, disproportionate to the actual harm caused (none) runs afoul of the Eight Amendment requirement that “excessive fines [not be] imposed.” Cato has filed an amicus brief calling for the U.S. Supreme Court to reverse the decisions below and clarify the scope of the Excessive Fines Clause.

South Carolina’s statute, like many similar state laws, is poorly worded and fails to define whether each individual manifestation of a regulatory violation is cognizable as an offense. Taking advantage of that lack of specificity, South Carolina converted a potential $5,000 fine into a $124 million one. Because of the huge numbers that can be achieved by multiplying even modest per-violation fines, state and federal regulators are often able to secure grandiose settlements and thereby insulate their fines from judicial review.

Moreover, the state supreme court here accepted this theory in the face of no evidence of harm resulting from the allegedly improper statements. The U.S. Supreme Court has said that under the Excessive Fines clause, the monetary penalty imposed shall not be “grossly disproportional to the gravity of the defendant’s offense.” United States v. Bajakajian (1998). A finding of no harmful effect attached to 9- or 10-figure penalties blows any notion of proportionality out of the water.

And South Carolina is not the only state where this is occurring. For example, an Arkansas court imposed a $1.2 billion penalty for purported misstatements about the same drug at issue here, on the theory that the Arkansas Medicaid Fraud False Claims Act was violated each time the drug was prescribed or re-filled. Other cases have revealed penalties as high as 20 or 46 times the harm suffered by consumers.

The Supreme Court should take this opportunity to reaffirm that the Eighth Amendment’s Excessive Fines Clause imposes a judicially enforceable limit on grossly disproportional fines. It will consider next month whether to take up Ortho-McNeil-Janssen Pharmaceuticals, Inc. v. South Carolina.

On the Right to Know Where Your Food Comes From

The federal government uses protectionist country-of-origin labeling (COOL) regulations to privilege a certain segment of the U.S. cattle industry at the expense of meat processors, retailers, and consumers.  Due to a successful challenge by Canada and Mexico at the World Trade Organization, and the resulting threat of trade retaliation, Congress may finally repeal the law.  This is good news.

I explained last month in The Hill(Online) what’s wrong with the COOL law:

Under current U.S. regulations, meat produced in the United States and sold in American grocery stores must carry a label indicating in which country or countries the animal was born, raised, and slaughtered. In order to comply with this law, American meat processors have to keep track of where each animal was born or raised and segregate any border-crossing cattle to ensure accurate labels. The requirement imposes a significant cost on processors, which they can avoid if the only cattle they purchase are born and raised in the United States.

The WTO ruled against the labeling law because much of what the law requires burdens processors who buy Canadian cattle without conferring any benefit on consumers.

In a free market, consumers receive product information if they care enough about it to pay for that information.  Sometimes providing that information is cheap and sometimes it’s expensive. 

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