August 18, 2006 3:16PM

Every Day in Every Way …

Big-ticket items drive most discussions of politics and government, but let's not forget to lament the small advances that help make big government what it is.

At the outbreak of hostilities in southern Lebanon, my well-traveled colleague Tom Palmer expressed dismay that Americans overseas should expect a lift home courtesy of the U.S. government when they've gotten in harm's way. Alas, by the end of July, Congress passed the Returned Americans Protection Act of 2006, which raised by $5 million the fiscal year 2006 limit on emergency assistance funds provided to U.S. citizens returning from foreign countries. Score one for bigger government — and for less responsible people.

But the bill actually results in reduced spending, saving about three cents (net present value) per U.S. family. How could this be?

A little legislative artifice did the trick. You see, the bill also allowed state food stamp agencies access to the National Directory of New Hires. They can use this database to verify employment and wage information for food stamp recipients using information on every newly hired American worker's employment, wages, and receipt of unemployment insurance. With access to these data, state food stamp agencies will be able to better verify the income of their beneficiaries and reduce overpayments.

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August 18, 2006 10:51AM

Wireless Progress — and the Challenge Not Yet Met

A lot is happening in the world of wireless telecommunications these days. And a lot is not. First, let's look at a couple things that are happening:

WiMax is poised to move forward as a significant new platform for broadband. "WiMax" is the popular name for the 802.16 wireless metropolitan-area network standard. It's like WiFi but can travel a lot farther. It easily traverses the "last mile," the complicated and expensive rights-of-way that create a high barrier to entry for competitors to DSL and cable.

Recently, Intel announced that a line of its chips will support WiMax. Intel also invested $600 million in leading WiMax provider Clearwire. Clearwire recently pulled back from an IPO, though, fueling speculation that Clearwire and WiMax are not all they're cracked up to be. Since then, Sprint Nextel has announced that it would spend up to $3 billion to build a WiMax network. Nothing is certain, but WiMax looks pretty good right now for bringing more competition to broadband.

Here's another thing happening: The Federal Communications Commission is amidst an auction of wireless spectrum. In 1993, Congress gave the FCC the authority to use competitive bidding for allocating rights to use radio spectrum. This beats comparative hearings and lotteries by a mile, because companies that have paid good money for spectrum tend to be well focused on making good use of it. This redounds to the benefit of consumers and the public through new, competitive wireless services.

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August 18, 2006 10:47AM

Pakistan and the “Other” Other War

Today's New York Times reports that Pakistan's president, Gen. Pervez Musharraf, is caught in "one of the most serious political binds of his nearly seven-year tenure." Gen. Musharraf's bind is an American bind, too, because he has been "one of Washington's most indispensable allies" since the 9/11 attacks, and Washington is loathe to see a nuclear-armed country of 165 million people become an enemy in the war on terrorism.

The tension between short-term diplomatic expediency and long-term political objectives has characterized U.S.-Pakistani relations for years. Another Pakistani general who took power in a coup, Mohammed Zia-ul-Haq, aided U.S. efforts to drive the Soviet Union out of Afghanistan in the 1980s (which we appreciated), even as his country was busy developing nuclear weapons (which we didn't). 

Today, the short-term benefit that we derive — Musharraf's cooperation in the fight against Al Qaeda and the Taliban — is being undermined by Musharraf's political weakness at home. We don't appreciate that groups in Pakistan have been linked to the London airplane bombing plot; we don't appreciate that Pakistan's government has proved either unable or unwilling to eliminate the flow of foreign fighters and foreign money into Afghanistan, as The Times of London reported yesterday; we are frustrated by the whitewash of the A.Q. Khan affair, one of the most notorious cases of nuclear proliferation in the history of the NPT regime; and it is uncomfortable, to say the least, for the Bush administration to say that it favors democracy while clinging tightly to an undemocratic ruler such as Musharraf. 

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August 18, 2006 9:37AM

Preference for Ignorance

Yesterday, I had a Tech Central Station column that said:

In the fields of health care, education, and assistance to poor countries, we rarely measure value properly. It seems as though we prefer to be ignorant about what succeeds and what fails. We know shockingly little about the cost‐​effectiveness of very expensive programs.

And today, the New York Times reports:

Some medical experts say Elyria’s high rate of angioplasties — three times the rate of Cleveland, just 30 miles away — raises the question of whether some patients may be getting procedures they do not need or whether some could have been treated just as effectively and at lower cost and less risk through heart drugs that may cost only several hundred dollars a year. Or whether, in some cases, patients might be even better off with bypass surgery — even though a bypass is a riskier, more invasive and more expensive procedure.





When it comes to treating blocked arteries, there are no definitive studies showing which approach most benefits patients in the long term.

The absence of cost‐​benefit analysis in medical decision‐​making is one of the main issues raised in my new Cato book Crisis of Abundance. On Tuesday, August 29th, Cato will be having a lunch forum on the book, where you can hear me as well as comments from Washington Post columnist Sebastian Mallaby and Democratic wonk Jason Furman.

August 18, 2006 9:32AM

An Anonymous Affront to Transparency

As the Federal Times reports, a bill designed to promote transparency in the federal government is being held up by a very non‐​transparent Senate procedure.


An anonymous senator has placed a “hold” on a bill that would create a publicly accessible federal database to track all federal grants and contracts. As Chris Edwards explains, it’s a meritorious piece of legislation. However, this bipartisan bill introduced by Sen. Tom Coburn is indefinitely stalled and might not reach the Senate floor this year.


The House has approved a similar, though slightly watered‐​down, version of this legislation that would monitor federal grants, but not contracts.


With 29 bipartisan senators co‐​sponsoring Coburn’s bill and roughly 100 diverse groups supporting it, you would think that this legislation would pass easily. 


Think again.


 

August 17, 2006 3:08PM

Bashing Wal‐​Mart (and Millions of Shoppers)

Can Democrats ride what they see as a populist wave of anger against Wal‐​Mart to success in the 2006 elections and beyond? According to a New York Times story this morning:

Across Iowa this week and across much of the country this month, Democratic leaders have found a new rallying cry that many of them say could prove powerful in the midterm elections and into 2008: denouncing Wal‐​Mart for what they say are substandard wages and health care benefits …


The focus on Wal‐​Mart is part of a broader strategy of addressing what Democrats say is general economic anxiety and a growing sense that economic gains of recent years have not benefited the middle class or the working poor.

This new strategy tells us much more about the lingering anti‐​business, anti‐​market and, yes, elitist mindset of the Democratic Party’s national leaders than it does about Wal‐​Mart itself.


Wal‐​Mart and other price‐​conscious discount retailers are really a working family’s best friend. They operate in the marketplace as representatives for millions of consumers, ensuring that they get the best and lowest prices possible from wholesalers and producers. Tens of millions of American shoppers vote with their feet every week by visiting their local Wal‐​Mart.


If Wal‐​Mart offers wages and benefits that are below the national average, it is not because of company policy but because of the realities of the marketplace. Retail jobs in general offer below‐​average compensation because the jobs tend to be lower‐​skilled and less productive than most other jobs. Even so, Wal-Mart’s wages within the retail sector are competitive. A worker at Wal‐​Mart is more likely to have health insurance and be paid more than a worker with similar skills at a small, “mom and pop” retailer.


The denunciation of Wal‐​Mart is largely driven by politics. Labor unions, a key Democratic Party constituency, see non‐​unionized Wal‐​Mart stores as a threat to their efforts to organize retail workers, especially those in the grocery sector.


Democrats will need to decide who they want to represent: Tens of millions of cost‐​conscious, lower‐ and middle‐​income shoppers, or noisy but far less numerous union members who do not like competition.

August 17, 2006 1:26PM

Judge Says NSA Wiretapping Program Unconstitutional

The ACLU brought a constitutional challenge to the NSA’s controversial wiretapping program several months ago and the judge has now ruled the NSA program to be unconstitutional (click on the 06 – 10204 pdf). This is just the initial round of what will likely be a long legal fight. The government will appeal and the battle will move to an appeals court, and then possibly to the U.S. Supreme Court.


For additional background, go here and here.