Archives: 03/2017

Court Rules the President Violated the 1965 Law with Executive Order

Last year, I put forward a statutory argument that President Trump’s proposal to ban immigrants from several majority Muslim countries was illegal because it violated a 1965 law that specifically banned discrimination against immigrants based on race, gender, nationality or place of residence or birth. On the night that the original executive order was released, I wrote an op-ed in the New York Times laying out the case again.

Now, finally, a ruling from a federal district court judge in Maryland addressed the issue, agreed with me in part, and partially stayed the executive order on this basis. This afternoon, the Trump administration appealed the ruling to the Fourth Circuit. The portion of ruling relevant to the statutory argument states:

Plaintiffs argue that by generally barring the entry of citizens of the Designated Countries, the Second Order violates Section 202(a) of the INA, codified at 8 U.S.C. 1152(a) (“1152(a)”), which provides that, with certain exceptions:

No person shall receive any preference or priority or be discriminated against in the issuance of an immigrant visa because of his race, sex, nationality, place of birth, or place of residence.

Martin Feldstein on U.S. Growth vs. Other Major Economies

Martin Feldstein has a new short paper out with some thoughts on a relatively under-researched subject: Why is Growth Better in the United States than in other Industrial Countries?

He begins:

In 2015, real GDP per capita was $56,000 in the United States. On a purchasing power basis, the real GDP per capita in the same year was only $47,000 in Germany, $41,000 in France and the United Kingdom, and just $36,000 in Italy. So the official measures of real GDP clearly point to the cumulative result of higher sustained real growth rates in the United States than in the major industrial countries of Europe and Asia.

Over the very long term, this is a truism. In order for the U.S. to be that much richer, it must have experienced faster real GDP per capita growth than comparator countries. We know from figures collated by the Maddison Project that the U.S. had around half the level of GDP per capita of the UK in the early 18th century, but by 1900 it was overtaking the UK as the richest country by income per head, and has remained in that leading position for almost all the period since.

But showing higher levels of income does not necessarily mean that the U.S. growth of GDP per capita was higher than other countries over more recent periods.

Natural Variability’s Role in Arctic Sea Ice Decline Strengthens Case for Lukewarming

Global Science Report is a 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 “Current Wisdom.”

A story this week that has been making the rounds in the climate-media complex finds that natural variability is responsible for perhaps as much as 50% of the summertime decrease in Arctic sea ice that has taken place over the past 30 years or so (anthropogenic climate change is the presumed factor in the remainder).

This isn’t new. The last (2013) science report from the UN’s Intergovernmental panel on climate change said:

Using climate model simulations from the NCAR CCSM4…inferred that approximately half (56%) of the observed rate of decline from 19979 to 2005 was externally (anthropogenically) forced, with the other half associated with natural internal variability.

Ten years ago, a study was conducted by a team led by Julienne Stroeve that looked at the observed rate of Arctic sea ice loss and compared it to climate model expectations. [A side note here: the loss of Arctic sea ice (which is floating ice) does not lead to sea level rise just as the melting of ice in your cocktail doesn’t lead to your glass overflowing]. What Stroeve and colleagues found was the Arctic sea ice was being lost at a far brisker pace than climate models had predicted (Figure 1).

Figure 1. Arctic sea ice extent from observations (red think line) and climate models (colored spaghetti), from Stroeve et al. (2007).

North Korea Policy: Hoping on a Hail Mary

The Trump administration’s North Korea policy started taking shape this week. On his first official trip to East Asia, Secretary of State Rex Tillerson declared an end to the Obama administration’s policy of strategic patience, ruled out negotiations with North Korea unless the North gave up nuclear weapons, and said that the United States would not rule out military action. Despite Tillerson’s attempt to put daylight between the Obama administration and the Trump administration, insisting on denuclearization and not ruling out the use of military force have been features of U.S. policy toward North Korea under both Bush and Obama. And this is precisely why the Trump administration’s approach, as it stands now, has little chance of succeeding.

Reining in North Korea has rapidly risen to the top of the Trump administration’s list of international challenges. In February, Pyongyang tested a solid-fueled ballistic missile with a tracked transporter erector launcher that will be very difficult for the United States to track and target in a preemptive attack. The following month, during the annual U.S.-South Korean Foal Eagle military exercises, which North Korea views as a dress rehearsal for an invasion, the North launched at least four ballistic missiles into the Sea of Japan simulating a nuclear attack against a U.S. Marine Corps air station at Iwakuni. Jeffrey Lewis of the Middlebury Institute for International Studies at Monterey succinctly described the Foal Eagle/missile launch interaction, “If we are practicing an invasion, they are practicing nuking us to repel that invasion.”

NATO Expansion Is Unwise. Saying So Isn’t Treasonous.

Ad hominem has always been a feature of politics, but Senator John McCain (R-AZ) elevated it to a new level earlier this week. The incident occurred when McCain came to the Senate floor to ask for unanimous consent to move forward on a vote formally bringing Montenegro, a small country in the Balkans, into the NATO alliance. Senator Rand Paul (R-KY) objected. McCain responded by suggesting Paul was a traitor to his country and accusing him of “working for Vladimir Putin.”

McCain seemed particularly incensed that Paul objected without explaining his reasons. As reported at the Daily Beast:

“I note the senator from Kentucky leaving the floor without justification or any rationale for the action he has just taken. That is really remarkable, that a senator blocking a treaty that is supported by the overwhelming number—perhaps 98, at least, of his colleagues—would come to the floor and object and walk away.”

He then directly connected Paul to the Russian government: “The only conclusion you can draw when he walks away is he has no justification for his objection to having a small nation be part of NATO that is under assault from the Russians.

“So I repeat again, the senator from Kentucky is now working for Vladimir Putin.”

Paul later issued a statement in response:

“Currently, the United States has troops in dozens of countries and is actively fighting in Iraq, Syria, Libya, and Yemen (with the occasional drone strike in Pakistan)…In addition, the United States is pledged to defend 28 countries in NATO. It is unwise to expand the monetary and military obligations of the United States given the burden of our $20 trillion debt.”

That seems like a reasonable position to hold, and certainly not one that requires Paul to be a Russian stooge.

Indeed, many of America’s most reputable officials and academics have opposed post-Cold War NATO expansion for substantive reasons. George Kennan, perhaps our most famous Cold War diplomat and widely considered to be the father of the United States’ containment strategy, famously opposed NATO expansion in the 1990s, writing in the New York Times that expanding NATO would be a “fateful error” that would “inflame the nationalistic, anti-Western and militaristic tendencies in Russian opinion” and “restore the atmosphere of the cold war to East-West relations.” Like Senator Paul, Kennan also worried about the problems of credibility and overextension. Would McCain accuse Kennan of treason?

Yellen’s Balance Sheet Baloney

Of the many questions reporters asked Janet Yellen on Wednesday, at her press conference following the FOMC’s decision to raise the Fed’s policy rates, my favorite was the very first, posed by the Financial Times’ U.S. Economics Editor, Sam Fleming.

Here is Mr. Fleming’s question:

[You’ve stated that the Fed wants to delay*] balance sheet normalization until [interest rate*] normalization is well under way. Could you give us some sense about “what well under way” means, at least in your mind — what kind of hurdles are you setting, what kind of economic conditions would you like to see, is it a matter of the level of the short term federal funds rate as being the main issue? What kind of role do you see the role of the balance sheet playing in the mobilization process over longer term? Is it an active tool or passive tool? Thanks.

And here is Chair Yellen’s response:

Let me start with the second question first. We have emphasized for quite some time that the committee wishes to use variations in the fed funds rate target or short term interest rate target as our key active tool of policy. We think it’s much easier, in using that tool, to communicate the stance of policy. We have much more experience with it, and have a better idea of its impact on the economy. So, while the balance sheet asset purchases are a tool that we could conceivably resort to if we found ourselves in a serious downturn where we were again up against the zero bound, and faced with substantial weakness in the economy, it’s not a tool that we would want to use as a routine tool of policy.

Mr. Fleming didn’t ask a follow-up question, so naturally I had no way of knowing what he thought of Yellen’s answer. I did, however, know just what I myself thought of it, which was, not much.

Making a Good Budget Great

President Trump’s 2018 budget takes a meat cleaver to many federal programs. In my issue areas–transportation, housing, and public lands–it would end the Federal Transit Administration’s New Starts program; end funding for Amtrak’s long-distance trains; eliminate HUD community development block grants; and reduce funding for public land acquisition.

Trump calls this the “America First” budget. What it really is is a “Federal Funding Last” budget, as Trump proposes to devolve to state and local governments and private parties a number of programs now funded by the feds. In theory, the result should be greater efficiency and less regulation. However, in most of the areas I know about, Trump could have gone further and produced even better results.

Transportation: I applaud the elimination of New Starts, the program that encourages cities to waste money on obsolete transit systems, but am disappointed that Trump would continue to fund projects with full-funding grant agreements. There are several insanely expensive projects, including the Maryland Purple Line and the Minneapolis Southwest Line, that have such agreements but haven’t started construction and should be eliminated. A number of streetcar and bus-rapid transit projects also fall into this category. If Congress is willing to live with no more full-funding grant agreements, it should allow the administration to also review and eliminate projects that haven’t yet begun construction or have made only token construction efforts.

The proposal to eliminate Amtrak long-distance trains is politically problematic. Since Amtrak’s other trains reach just 22 states, while the long-distance trains add 26 more, this proposal will look like it is favoring some states over others. As an alternative, I would have suggested that the federal government offer to cover 25 percent (or less) of the fully allocated costs (including depreciation) of each train or route, including the Northeast Corridor. If fares don’t cover the other 75 percent, then state support would be required or the trains would be cut. This is much more fair, especially because some state-supported trains actually require subsidies per passenger mile that are much larger than many of the long-distance trains.

Three other transportation proposals look good. One would transfer air traffic control to an independent, non-governmental organization, which would quickly install new equipment and increase airline capacities and safety. A second would eliminate the so-called Essential Air Service program, which subsidizes airports in smaller communities. Trump also proposes to eliminate the TIGER grant program, a relic of the 2009 stimulus bill, that has funded streetcars and other ridiculous projects.