Topic: Constitution, the Law, and the Courts

With Enzi Bill, GOP Abandons Federalism, Free Trade

The U.S. Senate steps through the looking glass this week, with a debate on a health care bill that would shift power from the states to the federal government. Republicans, who typically argue against such things, support the bill. Democrats, who never miss a chance to expand federal power, oppose it.

The bill, sponsored by Sen. Mike Enzi (R-WY), deals with health insurance regulation. That has traditionally been the province of the states, with one large exception: In 1974, the feds allowed large employers to avoid state regulation by opting for federal regulation.  That gave multi-state employers the benefit of only having to contend with one set of health insurance regulations (rather than 50). Federal regulation has also traditionally been less burdensome than state regulation.

In fact, the states have been regulating health insurance like mad. Many states require consumers to purchase unwanted or even offensive coverage. (Thirty states require Catholics to purchase coverage for contraception; 14 states require them to purchase in-vitro fertilization coverage.) States have passed some 1,800 of these “mandated benefit” laws. The states also regulate insurance prices, which actually increases the number of uninsured.

States get away with over-regulation because they prohibit consumers and employers from buying health insurance from out-of-state. If you lived in some regulatory hell-hole – let’s say, New Jersey – you could obtain much cheaper coverage by dealing with a carrier regulated by another state.

If Bruce Springsteen can purchase voice insurance from Lloyd’s of London, surely his neighbors should be able to buy health insurance from Pennsylvania.

Enter Sen. Enzi, who has an odd solution to this mess: Let trade associations offer health insurance to their members, and let the feds decide what state regulations they follow.  The bill seems to be deregulatory; it would allow “association health plans” to avoid some unnecessary regulatory costs. But it would be the feds – rather than employers or consumers – who choose the set of rules that govern one’s health coverage. Thus the bill would shift power from the states to the feds.

Democrats oppose the bill, though it’s hard to fathom why. The bill would make broad-based federal health insurance regulation – a long-time Democratic goal – much easier to achieve. In short order, that would erase any short-term savings the Enzi bill might deliver.

Sometimes, I suspect the Democrats’ opposition is a ruse: They keep opposing the idea because if they supported it, Republicans might come to their senses.

The real tragedy is that Republicans have at their fingertips legislation that would give individuals consumers and employers the right to purchase coverage from out-of-state.  Sen. Jim DeMint (R-SC) and Rep. John Shadegg (R-AZ) have a bill that would tear down those barriers to trade between states, as Congress was meant to do under the Commerce Clause

But the Shadegg-DeMint bill doesn’t have a powerful coalition of trade associations lobbying for its passage. Trade associations like the Enzi bill because it would allow them to offer health insurance as a benefit to their members. The Shadegg-DeMint bill would do the same thing. But somewhere along the way it was determined that federal regulation would be more politically feasible than free trade between the states.

I guess it’s easier to convince Republicans to increase their own power than to return power to individuals.

Kerr on the NSA Database

Over at the Volokh Conspiracy, Orin Kerr has an informative first cut at the legal issues surrounding the NSA’s newly revealed phone-call-record database. Bottom line: Whether you think the program is unlawful is likely going to depend on whether you think Article II allows the president to bypass statutes that infringe on tactics he wants to pursue in the war on terror.

McCain-Feingold Bites

So a court confirms that, under the McCain-Feingold law, it’s illegal to run ads urging a senator to vote for a bill in Congress if the bill is coming to the floor within 30 days of a primary election in which the senator is running unopposed. Because letting a grassroots group contact voters on a proposed constitutional amendment would compromise “the integrity of the electoral process.”

John McCain often takes the lead on economic freedom, and Russell Feingold was the only senator to vote against the PATRIOT Act, but they should both be sorely ashamed that they have so effectively blocked the voters from the sacred “electoral process.”

NSA Database II

The disclosure by USA Today that the NSA has another domestic surveillance database is no shocker. Yet the newly uncovered database includes only calling and receiving phone numbers, not the content of the conversations.

More ominous, when asked by Congress whether the NSA was monitoring the content of wholly domestic calls, Gonzales refused to rule out such surveillance. Indeed, from a policy rather than legal perspective, if it’s necessary and effective to monitor calls from, say, DC to Naples, Italy, then why not DC to Naples, Florida? If the NSA can disregard legal barriers because a communication might include information of foreign intelligence value, then monitoring domestic-to-domestic calls would seem no less justified than monitoring domestic-to-foreign calls.

When communications from and to a US person in the US are monitored, that’s domestic surveillance, no matter whether the party on the other end is inside or outside of the US.  Since Bush believes that warrantless domestic surveillance is permissible regardless of FISA’s contrary provisions, we shouldn’t be surprised if the NSA has much more data (including content) than USA Today has uncovered.

A Marshalltown Plan for Immigration

Below, Tom Palmer mentions Cato adjunct scholar Don Boudreaux’s wonderful essay on the ability of today’s United States to absorb immigrants as compared to our storied Ellis Island immigration heyday. I’d like to add a point that many Lou Dobbs fans seem not to fully grasp. Not only can we accommodate more people, we need more people.

I grew up in Marshalltown, Iowa. I’ll tell you, they’re not running out of space in Marshalltown. From the historic courthouse at the center of town, a ten to fifteen minute drive in any direction will put you in a cornfield. Over the past decade or so, Marshalltown has seen an influx of Mexicans – many from a single village, Villachuato – who came to work at the Swift meatpacking plant, or in the fields in the summer. This has caused a bit of friction in a middle-class town with a largely German and Scandinavian heritage – but just a bit. In fact, many small Midwestern towns like Marshalltown have been fighting for decades to hold on to a dwindling population. This is a real problem. Marshalltown businesses, for example, receive less than one application for each new job opening.

In 2001, with typical Iowan civic spirit, then-mayor Floyd Harthun ventured down to Villachuato to see if he could learn something about Marshalltown’s newest workers and taxpayers. Here’s part of an account of that trip, from a 2002 article in Governing Magazine (for state and local governments), which illustrates the symbiotic relationship between Mexican immigrants and towns like Marshalltown:

[Villachuatans] account for about half of the 1,900 employees at the largest employer in Marshalltown, a Swift & Co. meatpacking plant that also generates 1,200 additional jobs at related companies. Mexicans also have opened several new businesses in town, and their children have propped up sagging enrollment in Marshalltown schools. Not surprisingly, Mayor Harthun was eager to learn more about them – in part, because he wanted them to stay. “I was being self-serving,” he admits. “We need people.”

When Harthun reached Villachuato, several hours’ drive west of Mexico City, he was surprised to discover just how much the people there need Marshalltown as well. “About a third of the license plates were from Marshall County,” he recalls. He learned that Villachuatans who live in Marshalltown sent money to provide electricity and underground water in their native town, helped finance road-paving projects and restored the town church and town plaza. As Harthun visited with his hosts, he also started to understand something else: The villagers in Mexico are in close contact with their friends and family members in Iowa. “If a job opens up in Marshalltown,” he says, “the people in Villachuato know about it even before I do.”

Marshalltown (population 29,000) and Villachuato (about 15,000) are examples of what [University of Northen Iowa professor Mark] Grey calls “unofficial sister cities” – pairs of communities in Iowa and Mexico whose economies have become interdependent as a result of the flow of workers across the border. As Harthun learned, these relationships have developed out of view of the mainstream media and established institutions, following a logic rarely acknowledged in today’s polarized debates over immigration. And they show that while Americans often view immigration as an act of graciousness on our part, for many communities, it is becoming an economic development strategy as well, possibly making the difference between prosperity and economic decline.

What I love about this story (other than the fact that it makes me proud of my hometown) is the way it illustrates the positive-sum nature of exchange and human cooperation. Nobody loses when Marshalltown and Villachuato become sisters. It is maddening to see the Minutemen stringing barbed-wire along the Mexican border because that is an attempt to erect a literal barrier to the exercise of our natural moral right to cooperate – to deny our ability to make strangers our friends (our figurative siblings, even) through exchange. I agree that there is something terribly wrong when millions of people have to break the law to excercise their moral rights. But the problem isn’t that people are trying and succeeding to exercise them. The problem is poor legislation that fails to acknowledge, accommodate, and protect those rights. We can do better.

Marshalltown, a typical apple pie and baseball Midwestern town, has a great physical infrastructure, outstanding public schools, and more than enough room, physically and culturally, for tortillas and futbol. But it can’t merely accommodate more people, it needs them. There are thousands of Marshalltowns in this country (though no other may have my heart) that new immigrants could benefit and that could benefit new immigrants.

Now, part of the difficulty with immigration in a huge country like ours is that a lot of newcomers never make it out of the region of entry. This does place an undue burden of absorption on border states and port cities. No doubt most rural Mexicans have never heard of such exotic, faraway places as Iowa or Nebraska. But they should hear of them; they are needed there. Perhaps immigrants ought to be encouraged, like subway riders, to make space around the doors and move to the center.

NSA Database

USA Today reports that the NSA has a massive database of Americans’ phone calls. This is going to keep Bush’s controversial legal theories in the news for the next few weeks – especially since confirmation hearings for CIA director-designate General Michael Hayden are right around the corner. Here’s a pertinent excerpt from our new report on Bush’s constitutional record:

President Bush’s claim that he has the “inherent” power as commander in chief to order the secret surveillance of international e-mail and telephone conversations of persons within the United States raises a host of disturbing questions. For example, if the president can surveil international calls without a warrant, can he (or his successor) issue a secret executive order to intercept purely domestic communications as well? Can the president order secret warrantless searches of American homes whenever he deems it appropriate? Attorney General Alberto Gonzales has indicated that the president can order secret searches of American homes because President Bill Clinton deemed such break-ins “legal,” as if that would bolster the validity of his claim. 

Since Bush and his lawyers believe the president can arrest Americans without warrants (see the Department of Justice legal brief in the Padilla case), they presumably believe that domestic eavesdropping without warrants is also legal and appropriate. We’ll see what General Hayden says when he comes before the Senate.

Recent Cato debate on the NSA program here. Even more general background in this Cato report, Watching You.