Politicians have a genius for creating unintended consequences with each of their new firefighting measures. Just consider bank regulations. Today, reportage by Brooke Masters in the Financial Times informs us that the bill for new bank regulations in the EU could balloon to 50 billion euros. These regulations are intended to make banks “safe.” But, alas, they will suppress the money supply and economic activity. In consequence, new bank regulations, in the middle of an economic slump, promise to make banks less, not more, “safe” — a doom loop. Now is not the time to send in the Boy Scouts.

Everyone will find something to quibble with in today’s highly technical ruling in Arizona v. United States, which is not an indication of some baby-splitting grand compromise but rather that this is a really complex area of law. The Court, in an opinion by Justice Kennedy and joined by four other justices including Chief Justice Roberts, upheld (at least against facial challenge) Section 2(B) of Arizona’s SB 1070, which requires law enforcement officers to inquire into the immigration status of those they’ve lawfully detained if they have reasonable suspicion that the person is in the country illegally. The Court found, however, that federal law trumped (“preempted”) three other provisions: Section 3, which makes it a state crime to violate federal alien registration laws (because Congress so comprehensively “occupied the field” of alien registration); Section 5(C), which makes it a state crime for an illegal immigrant to “knowingly apply for work, solicit work in a public place or perform work as an employee or independent contractor” (because it conflicts with the method of enforcement chosen by Congress — regulating employers rather than employees); and Section 6, which allows law enforcement officers to arrest someone they have probable cause to believe has committed a deportable offense (because questions of removability are entrusted to federal discretion). Justices Scalia and Thomas wrote partial dissents to say they would’ve upheld the entire law. Justice Alito also wrote separately to say he would’ve only found Section 3 preempted.

My own view most closely aligns with Judge Alito’s—I would uphold three of the four provisions, though for me 5(C) is the problematic one—but more important than the legal weeds are the two policy guides the Supreme Court has given:

1. The federal government has significant, near-exclusive powers to regulate immigration and even state laws that merely “mirror” federal immigration laws are on shaky legal ground;*
2. Although federal lawmaking trumps state lawmaking, federal policymaking does not. Prosecutorial discretion, resource allocation decisions, and other policy processes do not preempt duly enacted state law.

In short, immigration policy by either state action or executive whim won’t cut it. The federal government—Congress and the president, working out that grand compromise—needs to fix our broken immigration system.

* Note that most of SB 1070 has been in effect since July 2010. The federal government only challenged six of its provisions, and two (regarding transporting/​harboring illegal aliens) were upheld by the district court, without further appeal by the government. In other words, state laws dealing purely with state prerogatives (such as crime or business regulation) are on much firmer legal ground.

The Supreme Court has now decided the Montana Supreme Court’s effort to overturn or to constrain Citizens United. As many expected, the Montana Court has been reversed without having a formal briefing and argument.

The five justices who decided Citizens United also decided this case. The four dissenters included Justice Stevens’ replacement, Justice Kagan. The majority found the case to be uncomplicated:

The question presented in this case is whether the holding of Citizens United applies to the Montana state law. There can be no serious doubt that it does. See U. S. Const., Art. VI, cl. 2.

They refer to the Supremacy Clause: “This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding.”

If judges in every state are bound by the Constitution and thus, the First Amendment, didn’t the Montana judges act contrary to their constitutional obligations?

The dissenters disagree with Citizens United and would have overturned it or allowed Montana to violate the First Amendment.

The party of government has long believed in the supremacy of the Supremacy Clause. For them moral progress is measured by increases in the scope and power of those who reside inside the Beltway. The four dissenters have found an exception to such centralization. No doubt their turnaround depends on new research into the meaning of the Fourteenth Amendment.

This decision should remind everyone that if one justice in the Citizens United majority leaves the Court, and President Obama selects his replacement, Citizens United will almost immediately be overturned.

We should all be so lucky as to have our crises be like the looming interest rate change on some student loans. Yes, the rate on subsidized federal loans will double on July 1 absent congressional action, but that needs to be put into context to see that it’s a potential “crisis” — as I heard it described on a radio news report last Friday — akin to your yacht sinking. Your toy, bathtub yacht.

Starting July 1, rates on subsidized loans — a subset of federal loans in which taxpayers eat beginning interest payments as well as bearing non-repayment risk — are set to rise from 3.4 percent to 6.8 percent.

That might sound bad, but note that the rates have only been at 3.4 percent for a year. A 2007 law set them on a gradual decline from 6.8 percent to 3.4 percent over five years. So it’s not like 3.4 percent has been the norm for decades…or even two years.

Next, the rate increase will only affect loans originated after July 1. People with existing loans won’t suddenly see the rates on all their subsidized loans double.

Third, while a rate doubling sounds big, the practical effect according to the White House’s own calculations will be to add about $1,000 to an average loan over its lifetime, which is about ten years. That translates into an additional $8.33 per month — less than the cost of a DC movie ticket.

Finally, freezing the rate for another year will do almost nothing for currently suffering middle-class families, unlike what the White House intimated in President Obama’s most recent weekly address. The large majority of loans originated after July 1 won’t even begin to be repaid for at least another year-and-a-half, after rising seniors have graduated and gone through the six-month repayment grace period.

It’s well known that a crisis is extremely useful for affecting political change — just ask Chicago’s mayor – but it often translates into bad policy. And that’s exactly the kind of policy that creating artificially cheap student loans is. They help fuel skyrocketing college prices, subsidize massive college waste, and contribute to millions of people enrolling who either never complete their studies or who finish largely worthless degrees.

All those consequences are problems that Washington really should worry about. But that’s the other thing about a crisis: It’s usually only embraced when it means giving stuff away to buy lots of votes.

The new book The Locavore’s Dilemma, which will be presented at Cato on Wednesday, got a good review in Saturday’s Wall Street Journal:

Pierre Desrochers and Hiroko Shimizu seem to have had the most fun among this group of authors. “The Locavore’s Dilemma” argues that the benefits of eating local have been vastly overstated by food activists and its serious detriments swept under the rug. The tone is distinctly upbeat, no doubt because being a gleeful debunker is fun but also because the two authors are resolutely cheerful about the world’s food situation.

Mr. Desrochers and Ms. Shimizu, a married couple who are both professional economists, present a counterintuitive but well-supported case that local self-sufficiency is the worst thing you can do for the environment, since it requires many crops to be grown in the wrong places, with damaging ecological consequences. American farmers, they observe, used to grow wheat locally in the Shenandoah Valley, tilling steep and rocky slopes—and unleashing a torrent of soil erosion. With the shift of grain farming to the far more productive and erosion-resistant soils of the Midwest, “more grain is now being produced on fewer acres and, overall, more habitat is available for wildlife.” Their study of the history of American agriculture is one of the strongest points of this book.

Famines were common in the past precisely because food security rested on the vagaries of local conditions rather than the resiliency of trade, they observe: “Subsistence farmers periodically starve while commercial agricultural producers who rely on monocultures for their livelihood don’t.”

Sign up for Wednesday’s Book Forum here.

Of course, when I say D.C., I don’t mean the federal government. I mean D.C. Mayor Vincent Gray. The Washington Post explains:

D.C. Mayor Vincent C. Gray leaves Saturday for a week-long trip to China to try to secure billions of dollars for investment in city development projects, including potential financing of the proposed 37-mile streetcar network.

In his first overseas trip as mayor, Gray (D) is looking to build on what he sees as China’s growing interest in the nation’s capital, as that country’s wealthy investors look to park large amounts of money in U.S. real estate.

…

When asked about a potential for congressional or public backlash about so much Chinese investment in the District, Gray said, “They are already heavily invested in America.”

“They are not heavily invested in the District of Columbia,” he said. “We are expanding our own horizons here and maybe moving some projects along more quickly.”

A federal judge has declined to dismiss a lawsuit against Netflix arguing that its Watch Instantly streaming viewing service violates the rights of deaf persons under the Americans with Disabilities Act because many of the movies it offers lack closed captioning. In the Boston Globe, Hiawatha Bray quotes me on the case:

…the high cost of adding accessibility features to all online entertainment services could pose an undue burden on Internet companies and lead to reduced choices for consumers, said Walter Olson, senior fellow at the Cato Institute, a libertarian think tank in Washington.

“This forces Netflix to serve markets that it currently doesn’t find profitable to serve,” said Olson, and could prompt online video companies to refrain from stocking obscure and unusual films, to avoid the expense of adding subtitles to movies that few customers will want to see.

The Caption Center at Boston public television station WGBH has subtitled thousands of films and TV shows, according to Larry Goldberg, WGBH’s director of media access. Goldberg said it costs $400 to $800 to add captions to a movie from scratch.

And captioning for the deaf is just the start if the law’s goal is to be what one advocate quoted in the Globe piece calls “100% equality.” Some in the blind community believe all films should be accompanied by “descriptive video” supplemental soundtracks that describe action on screen (“Jenny walks over to the desk and takes a revolver out of the drawer. She points it silently at the intruder.”) That could add substantial additional cost to the distribution of, say, small-circulation independent documentaries, vintage public-domain features and other low-revenue fare. While the current suit is against Netflix, the precedents it sets would also apply to much smaller providers of online streaming. Much more on the push for “web accessibility,” and its implications for almost everyone who communicates over the Web, here.