Last weekend, the tanker Paula Glory dropped anchor off Honolulu, having departed New Orleans four weeks earlier. Flagged in the Marshall Islands and riding low in the water—a sign of being fully laden—the vessel appears to be carrying fuel to Hawaii under the Jones Act waiver that took effect in March for energy and fertilizer products. If so, it will be the second foreign vessel to transport fuel to the Aloha State since March, further confirming the emergence of a domestic trade route with no precedent before the waiver.

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The proper delineation of authority between the federal government and the states has often been the subject of controversy in the debate over AI policy. Proponents of both approaches reference the constitutional clauses that support their claim. The reality is that this issue, as with many things in AI, is not a neat list of discrete policy matters. Instead, there is a clear mix of AI policy issues that require national attention—those that are the exclusive domain of the states and the issues that can be taken on by both the federal government and the states (or a collection of states). So how might a court or policymaker identify what level of governance is appropriate for different AI issues?

My paper, “The Obstruction Doctrine,” connects the jurisprudential dots that jointly establish a framework for evaluating whether a state’s exercise of power aligns with the letter and spirit of the Constitution. The first prong prevents states from inhibiting access to national markets. The second prong forecloses states from advancing laws that hinder the federal government’s ability to respond to issues that require national attention. And the third prong blocks states from interfering with national initiatives, such as extensive infrastructure projects. 

As the Federal Open Market Committee meets this week, the more telling story may be Chairman Kevin Warsh’s approach rather than the FOMC’s rate target decision. If his first meeting is any guide, he will say as little as possible; he has already declined to provide his own rate projections for the dot plot and significantly curtailed forward guidance. That restraint is deliberate, and it previews a far larger project. Warsh has launched five task forces to review how the Fed communicates, manages its balance sheet, uses data, understands productivity, and fights inflation.

Conducting a thorough review of monetary policy was the first recommendation we made when Warsh took office. The Fed adopted its flexible average inflation targeting regime in 2020, promised to let inflation run hot to make up for past shortfalls, and then presided over the worst inflation in four decades while calling it transitory. When the Fed ran its scheduled framework review in 2025, it revisited the wording of its consensus statement and little else. The five task forces are, in effect, the review that should have happened last year.

A new Cato briefing paper, released today, summarizes the best possible outcomes from this review. It works through each task force in turn, identifying the underlying problem and the reform that best addresses it. The recommendations differ in their particulars, but nearly all of them point in the same direction: The Fed serves the public best when it does less, not more. A well-functioning central bank commits to clear rules, holds a smaller footprint in financial markets, and leaves more room for prices and private information to do their work.

Communications is the cleanest illustration, and this week puts it on display. After 2008, the Fed came to rely on forward guidance, telling markets in advance what to expect and building an elaborate signaling apparatus around it. The goal was predictability, yet the result was often the opposite. Markets and incoming data usually offer a better real-time read of the economy than the Fed’s own forecasts, and guidance can drown out those signals. In September 2025, the data pointed to holding the rate target steady or even hiking, but the Fed had so firmly telegraphed a cut that reversing would have shocked markets—so it cut anyway, despite prevailing data.

Warsh’s instinct to say less is therefore a step in the right direction. If this meeting follows the pattern of his first—a shorter statement, little forward guidance, few clues about the path—that restraint is welcome. But restraint alone is fragile; it lasts only as long as the chairman who practices it. The durable fix is to replace discretionary communication with a rule. The Fed should publish its reaction function—a transparent formula linking its rate decisions to observable conditions—and let that stand as its communication. Predictability would then come from the rule itself, not from parsing a chairman’s silence, and forward guidance in its current form would become unnecessary.

The same logic runs through the rest of the paper. A balance sheet that ballooned past comfortable limits should be shrunk and simplified. A central bank that leans on slow, heavily revised government data should make room for faster private sources. A framework that bases policy on speculative productivity forecasts should instead rest on a rule. In each case, the reform narrows the Fed’s discretion and widens the space for markets and rules to operate.

None of this assumes the Fed can deliver perfect outcomes. It cannot. But a Fed that is more predictable, more accountable, and less intrusive than the one we have is a welcome step in the right direction.

Hasan Piker, a hugely popular commentator on Twitch and YouTube, is a self-described socialist who praises and campaigns for candidates backed by the Democratic Socialists of America and in the Democratic Party. He also has a soft spot for Mao Zedong, the Chinese dictator whose communist policies caused the deaths of 65 million people.

Piker, who has more than 5 million followers, many of them young Americans, says Mao is “one of the great leaders of this world.” Piker, 35, is no dunce—his streaming has made him a multi-millionaire—and he is influential. Libertarians should use this opportunity to educate people about Mao and the horrors of socialism/​communism.

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Last week, I wrote about Puerto Rico’s propane imports from the US mainland exploding once the Jones Act waiver made American supplies available for shipment via oceangoing tankers. In about four months, the island imported more than double the combined total shipped from the mainland during 2004–2025. The waiver, I argued, had turned a theoretical argument about the Jones Act’s harm to Puerto Rico’s energy supply into an empirical one.

Later that week, the Washington Post weighed in, and its July 23 editorial is worth a close look because (among other things) it adds something I didn’t: a comparison.

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In a recent New York Times essay, Josh Lipsky argues that tariff revenue has become important enough to federal finances that bond markets will make President Trump’s tariffs difficult for a future administration to unwind.

There is a simple arithmetic point behind the argument. Tariffs now raise a larger share of federal revenue, and refunding illegally collected duties or repealing tariffs without offsetting spending cuts or other revenue would increase the deficit.

But that argument pushes simple budget arithmetic into doing far too much work. Bond investors are not attached to customs duties as a line item revenue source. They care about the government’s overall fiscal position and about how policy affects economic growth, inflation, interest rates, and the cost of servicing the debt. Once those broader effects are considered, the market’s behavior over the past 18 months looks less like an addiction to tariffs than a response to the ever-changing size of the tariffs themselves.

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Financial regulators are the latest agents to be recruited in the Trump administration’s war on immigration. Their weapon of choice appears to be debanking.

Choke Point, Again 

The Federal Deposit Insurance Corporation (FDIC), National Credit Union Administration (NCUA), and Office of the Comptroller of the Currency (OCC) came together to warn banks about offering services to “individuals who are not legally authorized to work in the United States.” In other words, the regulators are pressuring banks to cut off anyone suspected of being an undocumented immigrant. 

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