Cato @ Liberty https://www.cato.org/ The Cato Institute seeks to broaden the parameters of public policy debate to allow consideration of the traditional American principles of limited government, individual liberty, free markets and peace. Toward that goal, the Institute strives to achieve greater involvement of the intelligent, concerned lay public in questions of policy and the proper role of government. en Must We Fight over What Children Will Learn? https://www.cato.org/blog/must-we-fight-over-what-children-will-learn <p><a href="https://www.cato.org/people/neal-mccluskey" hreflang="und">Neal McCluskey</a></p> <div data-embed-button="image" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="ca45e1b6-363c-47fb-97c8-f4de0c3640c6" class="align-center embedded-entity" data-langcode="en"> <p><img srcset="/sites/cato.org/files/styles/pubs/public/2020-01/BattleMap012920_4.png?itok=-lztpuLv 1x, /sites/cato.org/files/styles/pubs_2x/public/2020-01/BattleMap012920_4.png?itok=04Ome0sv 1.5x" width="700" height="338" src="https://www.cato.org/sites/cato.org/files/styles/pubs/public/2020-01/BattleMap012920_4.png?itok=-lztpuLv" alt="Cato Institute Public Schooling Battle Map" typeof="Image" class="component-image" /></p></div> <p>In 2005, the Dover Area School District in Dover, Pennsylvania, was experiencing what might be called a civil war. As <a href="https://abcnews.go.com/Nightline/Science/story?id=415444&amp;page=1">ABC News reported</a>, “Dover was at war with itself”:</p> <blockquote><p>Townspeople would attack each other in ways they never had before….ABC News went to Dover to tell the story, but found that a lot of people were not talking — not to us and not really to each other. Depending on which side they were on, some people had come to believe that anyone who disagreed with their views was either ignorant or quite possibly evil, and that explaining themselves only gave their enemies more ammunition.</p> </blockquote> <p>What caused this misery? The public schools, the very institutions that “father of the common school” <a href="https://www.pbs.org/onlyateacher/horace.html">Horace Mann</a> said would create harmony, fostering “a general acquaintanceship…between the children of the same neighborhood….[Where] the affinities of a common nature should unite them together so as to give the advantages of pre‐​occupancy and a stable possession of fraternal feelings….”</p> <p>Specifically at issue was the teaching of the development of life on Earth, a topic that inescapably implicates deep‐​seated religious beliefs, and that for many requires either that only creationism or evolution be taught. As ABC News explained, “The argument in Dover is of a special kind, where to let the other side win a little is to lose your own cause entirely.”</p> <p>Public schooling — in which diverse people are required to pay for a single system of government‐​run schools — inherently sets up such “special” conflicts. When two things cannot be simultaneously taught as true, or different values dictate different polices, one side must win, and the other <em>lose</em>.</p> <p>Alas, such conflicts, while not always as destructive as Dover’s, are not particularly rare. In 2005 — the same year as the Dover battle — Cato’s Center for Educational Freedom began collecting examples of conflicts like Dover’s, pitting diverse values, or other intensely personal matters such as racial identity or culture, against each other. The intent was to illustrate that assuming public schooling will create harmony is dangerous, even if it is widely accepted. Indeed, it makes little logical sense: as we’ve <a href="https://www.cato.org/publications/commentary/looking-bigotry-try-public-schooling-history">learned from history</a>, people do not happily sacrifice the things that <em>make them who they are</em>.</p> <p>The end product of that initial collection was the report “<a href="https://www.cato.org/publications/policy-analysis/why-we-fight-how-public-schools-cause-social-conflict">Why We Fight: How Public Schools Cause Social Conflict</a>.” Later, as we continued to collect conflicts, we decided to put our growing database on the Web, in searchable map form, so that wonks, reporters, and members of the public could see the kinds of very personal battles being fought in public schools, and get a sense that neither side is absolutely “right” nor “wrong,” but all are following their beliefs about what is right. We also wanted people in districts experiencing conflicts, and reporters covering them, to be able to locate places that may have suffered similar conflicts, and perhaps learn how they were ameliorated.</p> <p>Unfortunately, about nine months ago the application we had been using to generate Cato’s Public Schooling Battle Map was phased out, and ever since we have been working to replace it. But today, in the midst of <a href="https://schoolchoiceweek.com/about/?gclid=EAIaIQobChMIlfap7Kup5wIVjJyzCh04swJnEAAYASAAEgLrJvD_BwE">National School Choice Week</a>, we are ecstatic to report that <a href="https://www.cato.org/education-fight-map">the new Map is up and running</a>! It is not perfect — we will be adding more features soon — but it is working once again.</p> <p>The Map contains 2,267 conflicts in thousands of districts and every state. Often the battles are centered at the state level, where everything from <a href="https://www.seattletimes.com/education-lab/washington-may-mandate-comprehensive-sex-education-for-all-public-schools-what-does-that-mean-and-other-faqs/">sex education</a> standards to <a href="https://www.nbcdfw.com/news/local/texas-history-curriculum-standards/256008/">history curricula</a> may be determined, meaning no one in the state can escape the conflict. And while the districts on the Map represent only around 9 percent of all districts, they contain roughly 44 percent of the country’s total student population. This is likely a function of our primary information source being media reports, and media tending to be concentrated in places with more people. There are also doubtless some people unhappy with school policies or curricula who do not formally complain, or if they do no reporter hears about it. The Map, then, is at best a baseline of conflicts, not a comprehensive view.</p> <p>What does this have to do with school choice? Choice is fundamentally different from public schooling; its basic structure is far more <a href="https://www.wsj.com/articles/robert-maranto-and-dirk-c-van-raemdonck-letting-education-and-religion-overlap-1420761949">conducive to peace</a> and equality. Rather than forcing diverse families and communities to control a single system to get what they want taught, choice enables everyone to seek out what they need and desire. Rather than forcing everyone into a political arena, it lets them peacefully coexist.</p> <p>Hopefully the Map will reach many eyes, and help people realize that one side winning and the other losing, or maybe both having to sacrifice cherished parts of themselves, should not be the only possible outcomes when people disagree. Especially, we hope that reporters will use the Map, and write more articles like the too‐​rare ABC News piece with which this post started. Articles that focus not just on the two sides, like reporting on a boxing match, but that delve into the nature and underlying causes of the conflict. Maybe even articles that turn a spotlight directly on the zero‐​sum nature of public schooling. Because there is a more equal, more peaceful, way to structure an education system: school choice.</p> Wed, 29 Jan 2020 13:08:23 -0500 Neal McCluskey https://www.cato.org/blog/must-we-fight-over-what-children-will-learn Federal Budget Outlook: Worse than CBO https://www.cato.org/blog/federal-budget-outlook-worse-cbo <p><a href="https://www.cato.org/people/chris-edwards" hreflang="und">Chris Edwards</a></p> <p>The Congressional Budget Office <a href="https://www.cbo.gov/publication/56020">has released</a> new projections for federal spending and revenues through to 2030.</p> <p>Federal budget policy is a disaster. The government will spend $4.6 trillion this year, raise $3.6 trillion in tax revenues, and fill the gap with $1 trillion in fresh borrowing. That is like a worker earning $36,000 in income but spending $46,000 and putting $10,000 on credit cards. Maybe he can get away with the excess spending for a while, but eventually his finances will crash.</p> <p>The CBO’s baseline projections show spending rising faster than revenues in coming years, with the result that annual deficits by 2030 are expected to hit $1.74 trillion. Spending in 2030 at $7.49 trillion will be 30 percent higher than revenues of $5.75 trillion, as shown in the chart below.</p> <p>Those projections are ugly, but they are optimistic if policymakers do not enact major reforms. One optimistic CBO assumption is that discretionary spending will decline as a share of GDP in coming years, which seems unlikely given that both parties these days push for higher spending. So I’ve included on the chart a “more likely” spending projection that assumes discretionary spending stays at today’s share of GDP.</p> <p>On the revenue side, CBO includes the expiration of the GOP tax cuts after 2025, but it is likely that some or all of those cuts will be extended. Democrats may agree to extension in return for more low‐​income benefits. So the chart includes a “more likely” revenue line, which assumes the tax cuts are extended, which I roughly calculated by assuming revenues stay at the 2025 share of GDP.</p> <p>The more likely spending line also includes my rough estimate of the higher interest costs created by higher spending and lower revenues.</p> <p>Under the more likely scenario, the annual deficit by 2030 will be $2.37 trillion, up from $1.74 trillion under the CBO baseline. The more likely scenario has spending in 2030 at $7.79 trillion, which will be 44 percent higher than revenues that year of $5.42 trillion.</p> <p>Our economy is growing and we are at peace, so federal deficits and debt should be falling. But deficits are soaring and debt is at record high levels for peacetime as a share of the economy. The outlook is particularly scary because neither party is even talking about spending reforms. We are marching into a fiscal crisis and our elected leaders seem to have no idea how to tackle it and do not even seem to care.</p> <div data-embed-button="image" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="ba13257a-20d0-4ccc-a34a-1c88313bded9" data-langcode="en" class="embedded-entity"> <p><img srcset="/sites/cato.org/files/styles/pubs/public/2020-01/cbo%20outlook.png?itok=0-yz8vts 1x, /sites/cato.org/files/styles/pubs_2x/public/2020-01/cbo%20outlook.png?itok=Tfp1zzn5 1.5x" width="528" height="390" src="https://www.cato.org/sites/cato.org/files/styles/pubs/public/2020-01/cbo%20outlook.png?itok=0-yz8vts" alt="s" typeof="Image" class="component-image" /></p></div> Wed, 29 Jan 2020 12:23:54 -0500 Chris Edwards https://www.cato.org/blog/federal-budget-outlook-worse-cbo ADA: Lawyers Sue Retailers for Not Putting Braille on Gift Cards https://www.cato.org/blog/ada-lawyers-sue-retailers-not-putting-braille-gift-cards <p><a href="https://www.cato.org/people/walter-olson" hreflang="und">Walter Olson</a></p> <p>The Americans with Disabilities Act (ADA) reaches its 30th anniversary this year, which will touch off a&nbsp;year’s worth of coverage likely to be almost wholly celebratory in tone. Ten years ago, on the law’s reaching its 20th year, I&nbsp;took a&nbsp;<a href="https://www.cato.org/blog/adas-20th-anniversary">less celebratory</a>&nbsp;view that I&nbsp;think holds up well.</p> <p>Meanwhile, back in the trenches, four law firms and associated clients over a&nbsp;period of about a&nbsp;week last fall <a href="https://www.adatitleiii.com/2019/11/new-york-federal-dockets-flooded-with-cases-alleging-that-failing-to-provide-a-gift-card-with-braille-violates-the-ada/">launched a&nbsp;wave</a> of more than 100 putative class actions charging that retailers are violating the ADA by marketing gift cards that do not include Braille versions. Earlier, the same four firms and their associated clients had filed hundreds of New York lawsuits&nbsp;alleging that websites fell short of accessibility to the disabled.</p> <p>“The targets selected by plaintiffs in this new wave run the full gamut of retail establishments, including big box retailers, grocery stores, movie theaters, restaurants, clothing brands, and online gaming and other services,” <a href="https://www.huntonretailindustryblog.com/2019/11/articles/advertising-marketing/the-next-wave-of-accessibility-litigation-in-the-retail-industry-braille-gift-cards/">reports one law firm</a>. Typically, according to the Lawsuit Reform Alliance of New York (LRANY), “a successful plaintiff in [a local web accessibility] settlement will receive only $500 per case, but attorney’s fees average many times that amount, approximately $16,000 per case or more, depending on the law firm, the court and other factors, thereby giving plaintiff’s lawyers ample incentive to file as many cases as possible.” One attorney is said to have made about a&nbsp;million dollars a&nbsp;year this way over eight years.</p> <p>Does the ADA really require Braille on gift cards as an accommodation? Who knows? The courts are unlikely to provide a&nbsp;firm answer any time soon, what with the Supreme Court speaking only very infrequently and generally on the subject. Last fall, <a href="https://www.overlawyered.com/2019/10/ada-and-disabled-rights-roundup/">in the Domino’s case</a>, it ducked a&nbsp;chance to address the most pressing ADA issue of the past decade: the extent to which it requires redesign of websites.</p> <p>And so the ADA continues making life miserable for&nbsp;businesses and&nbsp;other regulated parties both large and small&nbsp;(just this weekend <a href="https://sanjosespotlight.com/access-v-abuse-crema-coffee-in-san-jose-closes-due-to-ada-lawsuit/">San Jose Spotlight reported on the demise</a> of a&nbsp;much‐​loved local coffee shop). As I&nbsp;<a href="https://www.cato.org/blog/pushing-back-against-ada-shakedowns">wrote last year</a> in this space:</p> <blockquote><p>Because ADA requirements are both obscure and voluminous and even compliance experts do not agree among themselves how much accommodation counts as enough, potential violations can be found at most businesses. While the ADA is a&nbsp;national law, much of the <a href="https://www.overlawyered.com/2018/03/ada-mass-filing-roundup-2/">mass filing of accessibility complaints</a> goes on under state laws that piggyback or expand on the federal version, often with added features enhancing damages or attorney’s fee entitlements.</p> </blockquote> <p>Only Congress can clarify what this law means, and it consistently refuses to do that, no matter which party is in charge.&nbsp;You can read more about the ADA’s ongoing impacts <a href="https://www.cato.org/blog/adas-assault-web-turn-congress">here</a>, <a href="https://www.cato.org/blog/ada-web-hour-grows-late">here</a>, <a href="https://www.cato.org/blog/ada-internet">here</a>, <a href="https://www.cato.org/blog/third-circuit-deafblind-patron-can-sue-movie-theater-demanding-tactile-interpreter">here</a>, and <a href="https://www.overlawyered.com/tag/disabled-rights/">here</a> [adapted from <a href="https://www.overlawyered.com/2020/01/wave-of-ada-suits-over-retailer-gift-cards-lacking-braille-version/">Overlawyered</a>]</p> Tue, 28 Jan 2020 14:29:37 -0500 Walter Olson https://www.cato.org/blog/ada-lawyers-sue-retailers-not-putting-braille-gift-cards More Evidence that the CRA Doesn’t Always Help Low‐​Income Communities. But Proposed Changes Will Improve It https://www.cato.org/blog/more-evidence-cra-doesnt-always-help-low-income-communities-proposed-changes-will-improve-it <p><a href="https://www.cato.org/people/diego-zuluaga" hreflang="und">Diego Zuluaga</a></p> <p>The Community Reinvestment Act is <a href="https://www.law.cornell.edu/cfr/text/12/25.22" rel="noopener noreferrer" target="_blank">supposed</a> to ensure that banks lend to low- and moderate-income households wherever they operate. But there are reasons to doubt its effectiveness.</p> <p>In the <a href="https://www.washingtonpost.com/opinions/local-opinions/a-tool-that-helps-minorities-buy-homes-is-speeding-up-gentrification-in-the-district/2019/08/09/10c08366-a744-11e9-9214-246e594de5d5_story.html/" rel="noopener noreferrer" target="_blank"><em>Washington Post</em></a> this summer, I reported findings (from a forthcoming paper with Andrew Forrester) that more than two-thirds of recent home mortgages in the District of Columbia for which banks can get CRA points went to high- rather than low-income borrowers. This is because current CRA regulations count loans to low-income borrowers <em>and</em> loans made in low-income census tracts (Figure 1a). D.C. has rapidly gentrified in recent years, as young professionals flocked into historically low-income neighborhoods, and many among these “gentrifiers” have bought homes. At present, CRA regulators take loans to gentrifiers into account when they evaluate banks, even though gentrifiers are not usually underserved borrowers.</p> <p><strong>Figure 1a: Loans to Low-Income Borrowers <em>and</em> in Low-Income Census Tracts Qualify for CRA Points</strong></p> <p><a href="https://cdn.alt-m.org/wp-content/uploads/2020/01/Screen-Shot-2020-01-27-at-8.50.35-PM-e1580220679192.png"><img alt="" height="389" src="https://cdn.alt-m.org/wp-content/uploads/2020/01/Screen-Shot-2020-01-27-at-8.50.35-PM-e1580220679192.png" width="1127" /></a></p> <p>Note: LMI stands for low- and moderate-income, defined as a median family income below 80 percent of the median for the metropolitan statistical area. Yellow designates loans eligible for CRA credit (points).</p> <p>Gentrification, as a rule, is a good thing for both new arrivals and historic residents. A recent <a href="https://www.philadelphiafed.org/-/media/research-and-data/publications/working-papers/2019/wp19-30.pdf">paper</a> from the Federal Reserve Bank of Philadelphia finds that gentrification benefits the original residents of low-income neighborhoods. While more-educated homeowners seem to gain most, even renters and the less-educated are better off as a result of the improved living conditions and increased opportunity that gentrification brings about. The impact of gentrification on migration by less-educated renters, arguably the most vulnerable group, to other neighborhoods is relatively small: 4 to 6 percentage points.</p> <p>The Philly Fed paper uses data from the 100 largest metropolitan statistical areas (MSAs), which needless to say differ widely in their local zoning laws, economic policies, history of segregation and discrimination, and other traits important for our analysis. It may well be that particular MSAs have worse outcomes from gentrification, for example, because zoning restrictions make it difficult for housing supply to respond to higher demand, causing displaced renters to face greater cost pressures and longer commutes. That, however, is not a direct consequence of gentrification but of local housing policy.</p> <p>Regardless of one’s views on the desirability of rapid neighborhood change, there is wide agreement that government policy should not <em>promote</em> gentrification. High-income young professionals have the means to buy a home. Besides, the excitement of moving to an up-and-coming neighborhood and the lure of capital gains provide ample incentive for many of them to do so.</p> <p>Moreover, in specific instances, there may be displacement of poorer (often minority) original residents, throwing into question the desirability of government helping to accelerate an inevitable development. For D.C., Andrew and I found that the minority share of a census tract’s population had declined by three percentage points for every additional percentage point of CRA-eligible lending between 2012 and 2017. That does not mean the CRA caused the displacement, nor does it negate other benefits of gentrification. But it should help persuade policymakers that counting gentrifier mortgages for CRA purposes is unnecessary if not outright harmful (Figure 1b).</p> <p><strong>Figure 1b: Loans to High-Income “Gentrifiers” Currently Count for Banks’ CRA Evaluations</strong></p> <p><a href="https://cdn.alt-m.org/wp-content/uploads/2020/01/Screen-Shot-2020-01-27-at-8.49.53-PM-e1580221097948.png"><img alt="" height="419" src="https://cdn.alt-m.org/wp-content/uploads/2020/01/Screen-Shot-2020-01-27-at-8.49.53-PM-e1580221097948.png" width="1126" /></a></p> <p>Note: Red designates loans to high-income borrowers in low-income areas.</p> <p>That is why I have <a href="https://www.wsj.com/articles/the-cra-often-helps-the-better-off-not-the-poor-11579635069">praised</a> Comptroller of the Currency Joseph Otting and Federal Deposit Insurance Corporation Chairman Jelena McWilliams’ decision to no longer count gentrifier loans in banks’ CRA evaluations. Their <a href="https://www.govinfo.gov/content/pkg/FR-2020-01-09/pdf/2019-27940.pdf" rel="noopener noreferrer" target="_blank">proposal</a>, unveiled in December, says the following about gentrifier mortgagers:</p> <blockquote><p>Although the agencies remain committed to encouraging banks to meet the credit needs in LMI areas, for banks evaluated under the general performance standards, the proposal would not apply a geographic distribution test to a bank’s consumer and home mortgage product lines. <strong>Under the geographic distribution test in the current CRA framework, banks receive positive consideration for home mortgage and consumer loans made in LMI areas, even if they are made to middle- or upper-income individuals or families.</strong> Unlike small loans to businesses and small loans to farms in LMI areas that may result in additional job creation or other positive effects for the larger community, <strong>home mortgage and consumer loans to middle- or upper-income individuals and families in LMI areas are generally not as beneficial to LMI communities and may result in displacement</strong>. Accordingly, this proposal would not apply the geographic distribution test to these banks’ home mortgage and consumer product lines. The result of this is that <strong>under the proposal, a mortgage loan to a high-income individual living in a low-income census tract would no longer qualify for CRA credit.</strong></p> </blockquote> <p>Otting and McWilliams are right. In the 1970s context of urban flight and decline, encouraging mortgages to high earners in low-income neighborhoods might have helped stem their migration to the suburbs—although the impact can only have been marginal, and the dramatic drop in house prices was the more meaningful spur for ambitious buyers. But those circumstances no longer apply. Instead, many large MSAs are changing rapidly, with a growing number of residents finding it hard to afford to live in them.</p> <p>Ahead of Wednesday’s House Financial Services Committee <a href="https://financialservices.house.gov/calendar/eventsingle.aspx?EventID=406021" rel="noopener noreferrer" target="_blank">hearing</a> with Comptroller of the Currency Joseph Otting, Andrew and I have expanded our analysis to the five most-populated MSAs in the country: New York, Los Angeles, Chicago, Dallas, and Houston. We suspected our finding for D.C., that a large share of CRA-eligible 1-to 4-family (known as single-family) mortgages go to gentrifiers, would also apply to these MSAs. But, because gentrification in D.C. has been more rapid, and the original residents’ starting position arguably more precarious, we also anticipated a weaker gentrifier bias for other MSAs.</p> <p>Table 1 lays out our findings. Three patterns are worth highlighting. The first is the substantial share of gentrifier mortgages in all CRA-eligible mortgages for all five MSAs, despite significant variation between them. The second is a steady increase in the share of gentrifier mortgages in the five years from 2012 to 2017. The third pattern is the large difference in gentrifier loans between New York and three of the four other MSAs, with L.A. somewhere in the middle but converging with New York more recently.</p> <p><strong>Table 1. Share of CRA-Eligible Single-Family Mortgages to High-Income Borrowers, by MSA and Year (%)</strong></p> <p><a href="https://cdn.alt-m.org/wp-content/uploads/2020/01/Screen-Shot-2020-01-27-at-8.49.29-PM-e1580221172926.png"><img alt="" height="533" src="https://cdn.alt-m.org/wp-content/uploads/2020/01/Screen-Shot-2020-01-27-at-8.49.29-PM-e1580221172926.png" width="1640" /></a></p> <p>Source: Home Mortgage Disclosure Act database.</p> <p>As we suspected, D.C. has an even greater share of gentrifier loans than other MSAs. This may be due to idiosyncratic economic factors related to the District’s profound, decades-long decline and its swift rebirth since the mid-2000s. Alternatively, Andrew and I only looked at mortgages in D.C. proper, rather than for the whole metropolitan area (which includes Arlington and Alexandria), which may bias our results since much recent gentrification has focused on the District – although some parts of Arlington have also undergone great change during this time period.</p> <p>I can only speculate about the differences between New York and L.A., the Texas MSAs, and Chicago. Texas is known for its relatively <a href="https://marketurbanism.com/2016/09/19/how-houston-regulates-land-use/" rel="noopener noreferrer" target="_blank">flexible</a> zoning rules, which help call forth new supply in response to housing demand, lowering prices and making homeownership more affordable to low-income families. Chicago's experience may have more to do with the city’s rising <a href="https://www.citylab.com/equity/2019/10/chicago-crime-rate-statistics-data-violence-segregation/599317/" rel="noopener noreferrer" target="_blank">crime rate</a> and the state of Illinois' economic underperformance since the 2008 recession ended. New York and L.A., on the other hand, are high-cost cities whose zoning codes appear to make housing needlessly unaffordable.</p> <p>Comptroller Otting and Chairman McWilliams' proposal to stop counting high-income mortgages under a statute that aims at helping the underserved will not, on its own, make housing more affordable in America’s biggest cities. But it will focus CRA regulations on the borrowers for whose sake it was enacted, while helping researchers answer the most important policy question regarding this 42-year-old law: does it in fact encourage banks to lend <em>without increasing risk</em>?</p> <p>[<a href="https://www.alt-m.org/2020/01/28/more-evidence-that-the-cra-doesnt-always-help-low-income-communities-but-proposed-changes-will-improve-it/">Cross-posted from Alt-M.org</a>]</p> <p></p> Tue, 28 Jan 2020 12:17:31 -0500 Diego Zuluaga https://www.cato.org/blog/more-evidence-cra-doesnt-always-help-low-income-communities-proposed-changes-will-improve-it Winner and Loser States from Big Government https://www.cato.org/blog/winner-loser-states-big-government <p><a href="https://www.cato.org/people/chris-edwards" hreflang="und">Chris Edwards</a></p> <p><span>American government has become much larger and more centralized over the past century. That has created winner and loser states as taxpayer cash floods into Washington and is then dispersed through more than 2,300 federal spending programs.<br><br> In 2020, the federal government will vacuum $3.6 trillion from taxpayer wallets in the 50 states and borrow $1 trillion from global capital markets. Then it will turn on the leaf blower to scatter $4.6 trillion back across the 50 states, except for the cut the middleman in D.C. will keep for itself.<br><br> The Rockefeller Institute has released <a href="https://rockinst.org/issue-area/new-yorks-balance-of-payments-with-the-federal-government/">a&nbsp;report</a> detailing these cash flows. The report calculates a “balance of payments” for each state in 2018, which is federal spending less federal taxes paid by individuals and businesses in each state. The winner states have a&nbsp;positive balance and the loser states a&nbsp;negative one. Federal spending includes four items: benefits (such as Social Security), state‐​local grants (such as Medicaid), procurement (such as fighter jets), and pay for federal workers.<br><br> On a&nbsp;per capita basis, the biggest winner states are Virginia, Kentucky, Alaska, and New Mexico. The biggest loser states are Connecticut, Massachusetts, New Jersey, and New York. Those loser states have a&nbsp;large number of high‐​earning individuals who get hit hard under the federal income tax, which imposes higher rates on top incomes.<br><br> Figure 1&nbsp;shows data from the Institute’s report. Taxes per capita are on the horizontal axis and spending per capita on the vertical axis. Each dot is a&nbsp;state. The figure excludes a&nbsp;portion of taxing and spending that could not be allocated by state. </span></p> <p><span>States on the bottom right are the losers and those on the top left are winners.</span> Connecticut is on the far right paying $14,004&nbsp;in federal taxes per capita but receiving only $11,750&nbsp;in federal spending. Connecticut would be better off in a&nbsp;decentralized United States with citizens paying their taxes to state and local governments rather than the federal government.</p> </p> <div data-embed-button="embed" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="d5b1c2f4-495c-4470-8529-19d569a768ce" data-langcode="en" class="embedded-entity"> <div class="embed embed--infogram js-embed js-embed--infogram"> <div class="infogram-embed" data-id="203bac24-f073-4e89-bd5b-d7785787dbbb" data-type="interactive" data-title="Balance of Payments Figure 1"></div> </div> </div> <p><br><br><span>Every state is actually worse off than indicated in Figure 1&nbsp;because federal borrowing in 2018 allowed for spending to be 22 percent larger than taxes. But borrowing is not a&nbsp;free lunch. It creates a&nbsp;cost that will hit residents of every state down the road — borrowing is just deferred taxes.</span><br><br><span><span><span><span><span><span><span><span><span>For Figure 2, I&nbsp;scaled up taxes to include both the current and deferred federal burdens. Connecticut residents paid $17,098&nbsp;in current and deferred taxes per capita and received only $11,750&nbsp;in spending. They are only getting back 69 cents in federal spending for every dollar of federal tax burden.</span></span></span></span></span></span></span></span></span></p> <p><span>In the figure, the loser states from centralized government are below the line and the winner states above it. Actually, because centralization creates lower‐​quality government, residents of every state lose, <a href="https://www.cato.org/sites/cato.org/files/pubs/pdf/pa868_2.pdf">as I&nbsp;discuss here</a>.</span></p> <p>The interesting political question is why do loser states such as Connecticut, Massachusetts, New Jersey, and New York stand for it? Politicians from those states should be pressing for a&nbsp;less progressive federal income tax and for devolution of government activities back to the states.</p> <div data-embed-button="embed" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="79531b87-3041-405c-b7e9-329df0e0d9bf" data-langcode="en" class="embedded-entity"> <div class="embed embed--infogram js-embed js-embed--infogram"> <div class="infogram-embed" data-id="b9ec9bc2-4575-4e1f-bf1e-2f853c0ec30a" data-type="interactive" data-title="Balance of Payments Figure 2"></div> </div> </div> <p>Research assistance from David Kemp.</p> Tue, 28 Jan 2020 12:03:29 -0500 Chris Edwards https://www.cato.org/blog/winner-loser-states-big-government Don’t Let Utopian Public Schooling Rhetoric Block School Choice https://www.cato.org/blog/dont-let-utopian-public-schooling-rhetoric-block-school-choice <p><a href="https://www.cato.org/people/neal-mccluskey" hreflang="und">Neal McCluskey</a></p> <div data-embed-button="image" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="9d92ef87-f30e-4031-ae2a-4368ae56e354" class="align-center embedded-entity" data-langcode="en"> <p><img srcset="/sites/cato.org/files/styles/pubs/public/2020-01/640px-RedschoolhouseClymer_0.jpg?itok=ygQz0qi7 1x, /sites/cato.org/files/styles/pubs_2x/public/2020-01/640px-RedschoolhouseClymer_0.jpg?itok=ZMfxlseI 1.5x" width="640" height="420" src="https://www.cato.org/sites/cato.org/files/styles/pubs/public/2020-01/640px-RedschoolhouseClymer_0.jpg?itok=ygQz0qi7" alt="A little red schoolhouse" typeof="Image" class="component-image" /></p></div> <p>I recently read <em><a href="https://jhupbooks.press.jhu.edu/title/democracys-schools">Democracy’s Schools: The Rise of Public Education in America</a></em> by Johann Neem, which in its title delivers the bedrock myth of public schooling: that it is essential to building harmonious, well‐​informed, citizens of a democracy. And it’s not just in the title that Neem waxes poetic about the public schools. In his preface he briefly recounts his experience as an immigrant child in Bay Area, California public schools, concluding that “by democratizing access to the kind of liberal arts education that was once reserved for the few, the common schools prepare all young people to take part in the shared life of our democracy.” Neem echoes the rhetoric of <a href="https://www.pbs.org/onlyateacher/horace.html">Horace Mann</a>, the “father of the common school,” who in the 1830s and 40s brought a missionary zeal to promoting largely uniform, free public schools in Massachusetts.</p> <p>The problem is that once you delve into the reality of public schooling, it does not at all match the rhetoric. To the credit of Neem and many other historians, they do not duck the reality, even if they seem to ultimately let the rhetoric get the better of them. Neem’s book is focused on pre‐​Civil War education, so he may have a different view of later public schooling, but towards the end of the book he offers a sober take on the <em>reality </em>of common schooling:</p> <blockquote><p>Schools may have effectively taught the basics, the three ‘Rs and a bit more, but they were less effective at inspiring young people to be citizens and to engage in self‐​culture. Instead, students saw schooling as something to get through. While in some cases this led to actual violence between teachers and students, in most cases there was tacit agreement that teachers had the authority to demand students’ compliance, and that students, with the support or pressure of their parents, would have to perform. There is little evidence that students left school wanting more.</p> </blockquote> <p>Public schools were not forging unified, enlightened citizens, as was the goal, but were largely just a mundane part of life. Which would be fine, except that taxpayer support of uniform public schooling is compelled on the grounds that it is so much more than what it actually is — it is essential for “democracy,” right? — and in that privileged position it has often been worse than just ineffectual at its professed purpose. It has imposed or reinforced inequality and injustice.</p> <p>I won’t go over all the injustice in detail — you can see where I’ve <a href="https://www.cato.org/publications/commentary/looking-bigotry-try-public-schooling-history">discussed</a> it <a href="https://www.cato.org/publications/commentary/segregation-school-choice-movement">in</a> more <a href="https://www.cato.org/policy-report/julyaugust-2008/american-bavarian-cream-pie">depth</a>—but remember that for much of its history public schooling often discriminated against minority religions, most notably <a href="https://www.amazon.com/State-Non-Public-School-1825-1925/dp/0826206336">Roman Catholics</a>. It often either completely barred or segregated African Americans—<a href="https://www.amazon.com/Jim-Crow-Boston-Origins-Separate/dp/030670157X">not just in the South</a>—and in some places Mexican and Asian Americans. It attacked the culturally unifying language of <a href="https://www.wisconsinhistory.org/Records/Article/CS413">German immigrant communities</a>. It now systematically treats religious Americans as <a href="https://www.tandfonline.com/doi/abs/10.1080/15582159.2018.1524427?journalCode=wjsc20">second‐​class citizens</a>. And it forces people with different values, cultures, and identities <a href="https://www.cato.org/education-fight-map">to fight</a> to see which “equal” people win, and which <em>lose</em>.</p> <p>School choice is fundamentally different from this. Based not on rhetoric about creating social and personal perfection, but on the reality of diverse human beings and communities, choice enables families to pursue the education that <em>they </em>want, that respects <em>their</em> cherished values and cultures, and that removes the threat that those with the most political power will impose their idea of “the good” on everyone.</p> <p>No doubt believers in public schooling such as Neem are guided by good intentions — they truly seek the ideal of unity and enlightenment for all — but too often, especially if they oppose school choice, they may let their ideals overtake their understanding of reality. And sometimes, it may lead them to forget that liberty is the country’s truly bedrock value.</p> Tue, 28 Jan 2020 10:49:02 -0500 Neal McCluskey https://www.cato.org/blog/dont-let-utopian-public-schooling-rhetoric-block-school-choice The Folly Of Bernie Sanders’ National Rent Control Proposal https://www.cato.org/blog/folly-bernie-sanders-national-rent-control-proposal <p><a href="https://www.cato.org/people/ryan-bourne" hreflang="und">Ryan Bourne</a></p> <p>“Landlords cannot be allowed to raise rents to whatever they want, whenever they want,” <a href="https://twitter.com/BernieSanders/status/1196452143005392902?s=20">Senator Bernie Sanders boomed on Twitter</a> in November. “We need…a national rent control standard.” Now, <a href="https://berniesanders.com/issues/housing-all/">his presidential campaign advocates one</a>: under Sanders’ housing proposals, all landlords nationwide would only be able to increase rents annually by one and a half times the rate of inflation or 3 percent, whichever is higher. Assuming the current CPI for Urban Consumers is the inflation measure used, that would mean a rent increase cap today of just 3.4 percent.</p> <p>Given the likely unconstitutionality of a truly national rent control law, one suspects Sanders should be taken seriously but not literally. What he is really doing here is endorsing a spate of new rent control laws across states, encouraging left‐​wing activists to push for more stringent restrictions elsewhere. California has already instituted <a href="https://www.cato.org/blog/statewide-california-rent-control-shooting-price-messenger">a 5 percent plus inflation cap</a> for older buildings. Oregon has passed a rent increase cap of <a href="https://www.cato.org/publications/commentary/statewide-rent-control-will-ultimately-please-nobody">seven percent per year above CPI</a>. New York just expanded protections for existing rent stabilized tenants and is expected to follow the others with a proposal for a general rent cap.</p> <p>But that Sanders’ national proposal probably won’t or can’t be implemented doesn’t mean his reasoning won’t damage housing policy across the country. His claim that landlords can charge “whatever they want” entrenches the idea that rents are set through greed or market power, not supply and demand. And if crude, low level rent increase caps are implemented even in individual cities, it could have disastrous consequences in “hot” markets – particularly given proposals like his are shorn of the exemptions one usually sees for small‐​time landlords, new properties or vacant units, that can provide a safety valve for the rental market.</p> <p>To see the folly of a national rent policy, consider the differential state of major U.S. housing markets. According to a <a href="http://www.demographia.com/dhi.pdf">Demographia report last week</a>, Rochester, New York has a median house price just two‐​and‐​a‐​half times the median income for the city. Similarly affordable housing can be found in Cleveland, Ohio and Oklahoma City (both 2.7 median multiples). On the other end of the spectrum, major Californian housing markets such as Los Angeles, San Jose, and San Francisco all have mean multiples above 8, while Seattle (5.5), Miami (5.4), and New York (5.4) are still deemed “severely unaffordable.”</p> <p>Given housing affordability varies so much, we shouldn’t be surprised that rents similarly differ by locality. And if we accept that rents differ across the country for similar housing because of different household sizes, incomes, land use and zoning laws, and more, it stands to reason that average rents will <em>change </em>at different rates year‐​to‐​year as these supply and demand factors vary.</p> <p>Looking across the last 20 years shows this clearly (see Table 1). In the broad housing markets around San Francisco, Seattle, Miami and Denver, average rent increases have exceeded what Bernie Sanders’ proposal would allow in over one of every two years. In contrast, cities such as Milwaukee, Cleveland, and St Louis have rarely seen rent increases exceed Sanders’ arbitrary cap. Within cities, we’d expect differences by neighborhood too (though perhaps with lower variance).</p> <div data-embed-button="image" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="43abce15-0cbb-4901-bd39-f053bef6bf85" data-langcode="en" class="embedded-entity"> <p><img srcset="/sites/cato.org/files/styles/pubs/public/2020-01/Sanders%20Rent%20Control%20Table%201.png?itok=n0L6sJ71 1x, /sites/cato.org/files/styles/pubs_2x/public/2020-01/Sanders%20Rent%20Control%20Table%201.png?itok=sTCXuJ91 1.5x" width="582" height="651" src="https://www.cato.org/sites/cato.org/files/styles/pubs/public/2020-01/Sanders%20Rent%20Control%20Table%201.png?itok=n0L6sJ71" alt="Years in Which Bernie Sanders' Rent Control Law Would Have Bound, On Average, By Metropolitan Area (2000-2019)" typeof="Image" class="component-image" /></p></div> <p>Is there any reason to suspect that landlords have been greedier in Miami than Milwaukee, or Seattle than St Louis? Or is it more likely that supply and demand trends have been different across cities over that 20 years? This evidence, plus the fact that rents within individual cities’ neighborhoods tend to quickly converge for certain property types and size, suggests that landlords cannot raise rents to “whatever they, whenever they want.” In reality, they are constrained both by tenants’ ability to pay and the availability of substitute properties. Or, to put it another way, by supply and demand.</p> <p>Once one accepts that rental prices are overwhelmingly the product of market forces, not landlord greed, you see why rent control, especially as Sanders’ envisages, is such a misguided idea. It effectively seeks to drown out the message that rising rents is submitting – of an increased relative scarcity of rentable accommodation that has led rents to rise to clear the market. Instead, capping rents forces on the market the comforting lie that property is abundant. That produces a whole range of well‐​documented consequences.</p> <p>Consider neighborhoods where market rents are expected to rise in the coming year beyond Sanders’ current 3.4 percent cap. The rent control will therefore bind, and if market rents continue increasing rapidly (perhaps because of an unresponsive supply of new housing to demand) then rents paid will become lower and lower relative to the underlying market rent. For hot rental markets:</p> <ol><li>Once it becomes clear rent controls are likely to be implemented, some landlords may seek to raise rents today before the cap becomes law, second‐​guessing how market rents will evolve in the very near future.</li> <li>Once the rent control binds, there will be a shortage of property relative to the quantity demanded. Existing landlords will, on the margin, seek to find ways to convert rental accommodation into <a href="https://www.sciencedirect.com/science/article/abs/pii/S0094119006000635?via%3Dihub">non‐​controlled forms of accommodation</a>, such as condos, offices, use through AirBnB, owner‐​occupancy, and more.</li> <li>Since rents cannot adjust to the new market reality over time, and there are no exemptions for new properties, <a href="https://www.nationalaffairs.com/storage/app/uploads/public/58e/1a4/9dd/58e1a49dd2c19946100154.pdf">capital investment in new rentable accommodation</a> will fall in neighborhoods affected. Existing buildings will likewise be knocked down and replaced with buildings for other uses. These effects will be exacerbated if landlords perceive rent control to be the precursor for other restrictions on how they use their buildings or choose their tenants. The overall <a href="https://www.aeaweb.org/articles?id=10.1257/aer.20181289">supply of rentable accommodation in the market will therefore fall</a> relative to where it would have been.</li> <li>Existing tenants who do not want to move will <a href="https://www.aeaweb.org/articles?id=10.1257/aer.20181289">benefit significantly from the controls</a>, with big rent savings. But over time that will mean many people being in accommodation that is the <a href="https://www.nber.org/papers/w6220">wrong size or location for them</a>. <a href="https://www.bbc.com/worklife/article/20160517-this-is-one-city-where-youll-never-find-a-home">Extensive wait lists</a> for properties and <a href="http://treromogkjokken.no/">black‐​market bribes</a> will likely proliferate.</li> <li>Ordinarily, crude rent controls can lead to <a href="https://www.sciencedirect.com/science/article/abs/pii/S0094119006000635?via%3Dihub">a deterioration of property quality</a>. Landlords have incentives to either allow the property quality to deteriorate so that the market rent falls to the controlled rent or else to change the tenure type to non‐​controlled forms. In the case of Sanders’ proposal, however, landlords can apply for waivers from the controls if significant capital improvements are made. In very hot markets there are therefore big incentives for rapid gentrification – converting to very expensive, high‐​end properties and then fixing rents very high initially to reflect binding rent controls into the future.</li> </ol><p>In short, a Sanders national rent control proposal would bring a lot of economic damage. But even if implemented more locally, such a crude rent cap would bring significant downsides to local housing markets, and the economy more broadly. And all based on the misguided idea that landlords have vast market power to set rents.</p> Mon, 27 Jan 2020 14:12:48 -0500 Ryan Bourne https://www.cato.org/blog/folly-bernie-sanders-national-rent-control-proposal True Tolerance Supports School Choice https://www.cato.org/blog/true-tolerance-supports-school-choice <p><a href="https://www.cato.org/people/neal-mccluskey" hreflang="und">Neal McCluskey</a></p> <p>It is <a href="https://schoolchoiceweek.com/">National School Choice Week</a>, a week dedicated to highlighting the power of choice in education, including public and private school choice. All week, we at Cato’s <a href="https://www.cato.org/centers/center-educational-freedom">Center for Educational Freedom</a> will be highlighting how choice contributes to social harmony.</p> <p>Today’s focus is tolerance, spurred in part by a growing critique that private school choice programs enable people to select schools that sow <em>in</em>tolerance. Just last week, the <em>Orlando Sentinel</em> ran a <a href="https://www.orlandosentinel.com/news/education/os-ne-voucher-schools-lgbtq-discriminate-20200123-s5ue4nvqybcgrbrxov5hcb46a4-htmlstory.html?fbclid=IwAR0gTeKN1kSpSF7GGAhRzKezS6DZrXiSBhyrObWLM3Nuj14OcoCWrHy-Rm0">series</a> <a href="https://www.orlandosentinel.com/news/education/os-ne-business-donations-tax-credit-20200123-xdzohcbw7zgfhnrmgtfniykn6u-htmlstory.html?fbclid=IwAR1uvvkwg4dzMd6tWdfT5iCWBRl87mEi9pUPq3DkrCIHIsQd3KFGR7PRDgk">of</a> <a href="https://www.orlandosentinel.com/opinion/scott-maxwell-commentary/os-op-florida-voucher-schools-gay-discrimination-scott-maxwell-20200124-cayfkn2jurbq3crgbd5mhxoyhe-story.html?fbclid=IwAR2jg_v9FI1IGIYkVrsmalLsFMpPjL4xdScZu9_-PUyz48CXcLUixtAbZSM">articles</a> attacking Florida’s private school choice programs because parents can select schools that have policies that some people — including the <em>Sentinel</em>—deem “anti‐​LGBT.” The schools and the parents that use them, of course, view their policies differently: as upholding important religious teachings.</p> <p>Let’s start with some basic private school facts. As I <a href="https://www.cato.org/blog/school-choice-rules">discussed a few months ago</a>, a recent <a href="https://nces.ed.gov/pubsearch/pubsinfo.asp?pubid=2019106">federal study</a> found that private schools are generally safer and have more harmonious climates than public schools. They are less likely to experience gang activity, hate‐​related graffiti, bullying, or hate speech. Parents, as you can see below, are also much more satisfied with them.</p> <div data-embed-button="image" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="f21e6873-8669-4ffb-804d-e03863c469db" class="align-center embedded-entity" data-langcode="en"> <p><img srcset="/sites/cato.org/files/styles/pubs/public/2020-01/satisfaction.png?itok=Hyaqonrj 1x, /sites/cato.org/files/styles/pubs_2x/public/2020-01/satisfaction.png?itok=L6JXuSE1 1.5x" width="700" height="445" src="https://www.cato.org/sites/cato.org/files/styles/pubs/public/2020-01/satisfaction.png?itok=Hyaqonrj" alt="Parents more satisified with private schools" typeof="Image" class="component-image" /></p></div> <p>But surely private schools produce less tolerant students and graduates? After all, they pull kids from inclusive public schools and put them in exclusive settings. The children do not learn to peacefully coexist with those who look or think differently from themselves.</p> <p>Not really. Research, often after controlling for student characteristics such as family wealth, has typically found that compared to public schoolers, private school students and graduates <a href="https://www.tandfonline.com/doi/abs/10.1080/15582159.2017.1395615?journalCode=wjsc20">are as tolerant or more tolerant</a> of others.</p> <p>One possible reason for this is precisely that choice enables people with different values to choose schools that share them, rather than making diverse communities into combatants forced to fight out whose values will win, and whose will <em>lose</em>. Indeed, right after the <em>Orlando Sentinel</em> ran its articles, <a href="https://cbs12.com/news/local/parents-angered-surprised-over-new-book-on-high-school-reading-list">pieces</a> <a href="https://www.sun-sentinel.com/news/sound-off-south-florida/fl-ne-sosf-book-banning-20200125-gqaba56pbbf2vixgz2xbddccdy-story.html">appeared</a> in other outlets about parents fighting public school readings they believe force inappropriate, including pro‐​LGBTQ, views on their children. We see such throwdowns perpetually in the Sunshine State and <a href="http://www.ala.org/advocacy/bbooks/frequentlychallengedbooks">nationwide</a>.</p> <p>Meanwhile, in <a href="https://www.ajc.com/news/local-education/first-its-kind-school-for-lgbt-youth-open-atlanta/q2z31VTEzz8I6pk1dZziaJ/">Georgia and elsewhere</a>, private schools are popping up specifically for LGBTQ kids. Why? Because public schools are often very intolerant places for them, if not by official policy, by school culture. School choice enables LGBTQ or other children who don’t fit in at their assigned public institutions to find schools that are warm and affirming.</p> <p>Unfortunately, to garner sufficient political support to extend <em>equal </em>school choice — not paying once for public schools and a second time for private — to everyone, people broadly need a basic tolerance for beliefs and opinions different from their own. But human beings seem to have a powerful predilection for demanding equality for themselves, but not those with different values. We are seeing this more and more when it comes to religious schools that disapprove of LGBTQ behavior, but have also seen it from some school choice supporters when programs <a href="https://www.cato.org/blog/state-rep-balks-voucher-funding-muslim-school">might include Islamic schools</a>.</p> <p>True tolerance is allowing others to be treated equally under the law even when you disagree with what they believe. This in no way means you have to approve of their views — freedom also means you can speak out against beliefs you find abhorrent, and shun the people who hold them — but you cannot use the legalized force of government to treat them differently.</p> <p>Such political tolerance is for the good of all society. Until human beings are omniscient and infallible, it is extremely dangerous to enable one group to forcibly impose on all their conception of a good and proper life. It is an existential threat to everyone’s freedom.</p> Mon, 27 Jan 2020 11:40:03 -0500 Neal McCluskey https://www.cato.org/blog/true-tolerance-supports-school-choice The ACA Expanded Insurance Coverage of Contraceptives. Prices Soared. https://www.cato.org/blog/aca-expanded-insurance-coverage-contraceptives-prices-soared <p><a href="https://www.cato.org/people/michael-cannon" hreflang="und">Michael F. Cannon</a></p> <p>In today’s <a href="https://www.latimes.com/opinion/story/2020-01-27/birth-control-pill-over-the-counter"><em>Los Angeles Times</em></a>, Cato senior fellow Dr. <a href="https://www.cato.org/people/jeffrey-singer">Jeffrey A. Singer</a> and I&nbsp;note that once the Affordable Care Act’s contraceptives‐​coverage mandate took full effect in 2014, “prices for hormones and oral contraceptives stopped falling and instead skyrocketed. By 2019, they had risen three times as fast as prices for prescription drugs overall.” Here we provide the underlying data.</p> <p>The Affordable Care Act (ACA) dramatically expanded insurance coverage for prescription contraceptives such as “the pill.” From August 2012 through January 2014, the federal government phased in the ACA’s requirement that nearly all private health insurance plans must cover all Food and Drug Administration‐​approved prescription contraceptives with no cost‐​sharing. In addition, from 2014 through 2017, the ACA enrolled an <a href="https://www.guttmacher.org/article/2018/12/gains-insurance-coverage-reproductive-age-women-crossroads">estimated</a> 5&nbsp;million previously uninsured women of child‐​bearing age in either private insurance plans subject to that mandate or in Medicaid, which also covers prescription contraceptives with no cost‐​sharing.</p> <p>As a&nbsp;result of these changes, the share of consumers who are sensitive to the price of contraceptives plummeted. The Kaiser Family Foundation <a href="https://www.kff.org/womens-health-policy/fact-sheet/oral-contraceptive-pills/">reports</a> that, among women with large‐​employer coverage who use oral contraceptives, “the share experiencing out‐​of‐​pocket spending…declined from 94 percent in 2012 to 11 percent in 2017.” From 2012 through 2014, ACA‐​mandated <a href="https://www.kff.org/womens-health-policy/issue-brief/private-insurance-coverage-of-contraception/">coverage</a> of contraceptives all by itself “account[ed] for nearly two‐​thirds (63%) of the drop in out‐​of‐​pocket spending on retail drugs” across all consumers.</p> <p>The ACA’s reshaping of the market for oral contraceptives precisely coincided with a&nbsp;dramatic increase in prices for those items. Since December 2009, the U.S. Bureau of Labor Statistics’ (BLS) Producer Price Index (PPI) has measured the prices manufacturers receive for a&nbsp;sample of domestically produced hormones and oral contraceptives. The nearby figure shows what happened to real prices for hormones and oral contraceptives before and after the ACA’s contraceptives‐​coverage mandate took effect.</p> <p>Before the mandate took effect — i.e., during a&nbsp;period when consumers more often paid for oral contraceptives directly — price changes for hormones and oral contraceptives generally followed a&nbsp;path similar to that of non‐​prescription drugs, which insurance typically does not cover, and which also fell in real terms. Prices for hormones and oral contraceptives actually <a href="https://fred.stlouisfed.org/series/WPU06380105#0">fell</a> by 12 percent in real terms.</p> <p>As the mandate began to take effect and as the ACA made oral contraceptives seem “free” to more&nbsp;purchasers, prices for hormones and oral contraceptives began to rise. By the time the mandate took full effect in early 2014, prices for hormones and oral contraceptives reversed five years of real reductions and caught up to the 17 percent growth in real prices for other prescription drugs.</p> <p>Once the mandate took full effect, prices began to rise rapidly. From May 2013 through May 2019, while real prices for non‐​prescription drugs and prescription drugs overall rose just 12 percent and 37 percent, respectively, prices for hormones and oral contraceptives rose 108 percent. That’s nearly three times the rate of price growth for other prescription drugs.</p> <div data-embed-button="embed" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="abaee153-e26c-4a9a-aa5b-1f9a3d4732c8" data-langcode="en" class="embedded-entity"> <div class="embed embed--infogram js-embed js-embed--infogram"> <div class="infogram-embed" data-id="_/wcsntHzMdkSKWKZT3yc0" data-type="interactive" data-title="Drug Reformation, Figure 1"></div> </div> </div> <p>The PPI for hormones and oral contraceptives has limitations as a&nbsp;measure of prices for hormonal contraceptives in general and oral contraceptives in particular. First, it samples and estimates changes in the initial prices drug manufacturers receive, not the ultimate prices insurers and consumers pay. Second, it samples and estimates changes in prices only for domestically produced drugs, excluding drugs produced in other countries and Puerto Rico. Third, it encompasses drugs other than contraceptives that may have an important influence on the index.</p> <p>Unfortunately, the BLS neither discloses which drugs it samples nor the relative contributions of contraceptives versus other hormonal drugs. The PPI for hormones and oral contraceptives is therefore an imperfect measure because it does not necessarily reflect the changes in consumer prices for all hormonal contraceptives available to consumers, and may instead reflect changes in (non‐​consumer) prices for non‐​contraceptive hormonal drugs. The BLS’s Consumer Price Index (CPI) for prescription drugs lacks some of these shortcomings. Unfortunately, the BLS does not publish CPIs for prescription drugs at the level of therapeutic class.</p> <p>Even with these limitations, these data suggest that trying to make oral contraceptives “free” for insured consumers had the unintended consequence of making them far more expensive for insurance companies and women who buy them without insurance, including young women who prefer not to purchase them through their parents’ insurance.</p> <p>In the Cato Institute book <a href="https://www.amazon.com/Overcharged-Americans-Much-Health-Care/dp/1944424768"><em>Overcharged</em></a>,<em> </em>Cato adjunct scholars <a href="https://www.cato.org/people/charles-silver">Charles Silver</a> and <a href="https://www.cato.org/people/david-hyman">David Hyman</a> explain why paying for health care through insurance often causes prices to rise. Despite the supposed purchasing power of third‐​party payers, insurers are not very good at reducing prices. When consumers don’t care about prices, they actively resist attempts by third‐​party payers to negotiate lower prices. This dynamic gives providers, including manufacturers of oral contraceptives, free rein to raise prices.</p> <p>In a&nbsp;forthcoming Cato Institute white paper, Singer and I&nbsp;propose taking away the FDA’s power to require women to obtain a&nbsp;prescription before purchasing birth control pills.</p> Mon, 27 Jan 2020 08:57:57 -0500 Michael F. Cannon https://www.cato.org/blog/aca-expanded-insurance-coverage-contraceptives-prices-soared NASEM Makes a Major Plea for Harm Reduction in Drug Policy https://www.cato.org/blog/nasem-makes-major-plea-harm-reduction-drug-policy <p><a href="https://www.cato.org/people/jeffrey-singer" hreflang="und">Jeffrey A. Singer</a></p> <p><span><span><span><span><span><span><span><span><span><span><span>The Health and Medicine panel of the National Academy of Sciences, Engineering and Medicine (NASEM) released its report <em><a href="http://www.nationalacademies.org/hmd/Reports/2020/oud-infectious-disease-services.aspx">Opportunities to Improve Opioid Use Disorder and Infectious Disease Services</a></em> on January 23. The panel consisted of academics, medical professionals, epidemiologists, nurses, and health policy specialists. Among the panel’s <a href="https://www.nap.edu/resource/25626/OUD-infectious-disease-services-recommendations.pdf">recommendations</a> were:</span></span></span></span></span></span></span></span></span></span></span></p> <ul> <li>Eliminate the mandatory “X‑waiver” requirement for health care practitioners wishing to prescribe buprenorphine for substance use disorder/​withdrawal management, and removing limits on the number of patients that can be treated by a&nbsp;given practitioner.</li> <li>Allow methadone treatment to be prescribed in primary care settings.</li> <li>Assure that undergraduate and graduate medical education includes “practical, clinically relevant, harm‐​reduction‐​focused” training on opioid use disorder and infectious diseases assessment.</li> <li>Incorporate harm reduction strategies in clinical practice, including referral to syringe services programs (commonly referred to as “needle exchange” programs), and prescribing pre‐​exposure HIV prophylaxis (PrEP) and post‐​exposure prophylaxis (PEP).</li> <li>“States should lift the remaining bans on evidence‐​based syringe services, offering syringe services at publicly funded health departments and allowing for independently operated syringe service programs.”</li> </ul> <p><span><span><span><span><span><span><span><span><span><span><span>The report also had something to say about the unintended consequences of current policies toward opioid “misuse” and use disorder:</span></span></span></span></span></span></span></span></span></span></span></p> <blockquote><p><span><span><span><span><span><span><span><span><span><span><span>Even well‐​intentioned policies have exacerbated the link between OUD and infectious disease. For instance, implementation of prescription drug monitoring programs and other measures to limit access to prescription opioids triggered a&nbsp;transition to heroin and, eventually, injection use among people who had become dependent on prescription pain relievers. At the same time, primary care clinics have not adequately screened, treated, and retained patients on treatment for SUD. The resulting increase in the number of people who inject drugs (and engage in high‐​risk sexual behaviors in exchange for drugs) has also increased the overall risk of infectious disease outbreaks. </span></span></span></span></span></span></span></span></span></span></span></p> </blockquote> <p>I have written on numerous occasions that the “X‑waiver” and other restrictions on buprenorphine should be <a href="https://www.cato.org/blog/will-congress-finally-x-out-x-waiver">repealed</a>. I&nbsp;have argued <a href="https://www.cato.org/blog/methadone-mixed-messages">here</a> why the Drug Enforcement Administration’s current methadone clinic regime should be scrapped, and primary care providers be allowed to prescribe methadone to their patients with substance use disorder — as is done in Canada, the U.K., and Australia since the 1970s.</p> <p><span><span><span><span><span><span><span><span><span><span><span>I recently argued in the pages of the <em><a href="https://www.sfchronicle.com/opinion/openforum/article/FDA-should-make-anti-HIV-drug-over-the-counter-14833367.php">San Francisco Chronicle</a> </em>that Prep and PEP should be available over‐​the‐​counter. The Cato Institute hosted a&nbsp;policy forum that included a&nbsp;discussion about&nbsp;state barriers to syringe services programs earlier this month. At the forum,&nbsp;U.S. Surgeon General Jerome Adams and University of Southern California Medical School Professor Ricky Bluthenthal argued for the&nbsp;removal of state barriers. You can view it <a href="https://www.cato.org/multimedia/events/needle-exchange-programs-benefits-challenges">here</a>.</span></span></span></span></span></span></span></span></span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span>Last October, the Cato Institute hosted a&nbsp;conference on “Patients, Privacy, and PDMPs” that included a&nbsp;presentation by Columbia University researcher David Fink about the unintended consequences of prescription drug monitoring programs, including an increase in heroin use. You can view that <a href="https://www.cato.org/events/patients-privacy-and-pdmps">here</a>. And a&nbsp;little over a&nbsp;year ago, the Cato Institute published my <a href="https://www.cato.org/publications/policy-analysis/harm-reduction-shifting-war-drugs-war-drug-related-deaths">policy analysis</a>&nbsp;on harm reduction. </span></span></span></span></span></span></span></span></span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span>It is gratifying to see a&nbsp;prestigious organization like NASEM express similar views. NASEM provides a&nbsp;summary of the report’s highlights <a href="https://www.nap.edu/resource/25626/OUD-infectious-disease-services-highlights.pdf">here</a>.</span></span></span></span></span></span></span></span></span></span></span></p> Sat, 25 Jan 2020 11:52:59 -0500 Jeffrey A. Singer https://www.cato.org/blog/nasem-makes-major-plea-harm-reduction-drug-policy Wealth Is Business Ownership https://www.cato.org/blog/wealth-business-ownership <p><a href="https://www.cato.org/people/chris-edwards" hreflang="und">Chris Edwards</a></p> <p>On her campaign website, Senator Elizabeth Warren <a href="https://elizabethwarren.com/plans/ultra-millionaire-tax/">discusses</a> reasons why she supports an annual wealth tax. She says, “<span>Consider two people: an heir with $500 million in yachts, jewelry, and fine art, and a teacher with no savings in the bank.” </span></p> <p><span>Is that how an heir would hold $500 million — in yachts, jewelry, and fine art? That perception of the assets of the rich seems to be common. Economist John Cochrane <a href="https://johnhcochrane.blogspot.com/2020/01/wealth-and-taxes-part-i.html">suggests</a> that people think top wealth looks like Scrooge McDuck’s gold vault.</span></p> <p><span>Of course wealthy people own personal luxury assets, but most wealth at the top is business assets. </span>In <a href="https://www.cato.org/blog/top-wealth-business-assets">this piece</a>, I look at the holdings of the richest 0.1 percent of Americans, who are people with net wealth above $16 million. <span><span><span>Almost 90 percent of that group’s wealth consists ultimately of equity and debt in businesses, which in turn funds capital investments and creates jobs and growth.</span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span>A related belief people have is that wealth at the top comes at others’ expense, as does the lady in this 1979 video below (<a href="https://www.mercatus.org/people/tad-dehaven">h/​t</a>). But the reality is the opposite, as Milton Friedman explains to her on the Phil Donahue show. </span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p> <p><span>Wealth at the top supports opportunities for other people, as discussed <a href="https://www.cato.org/publications/commentary/wealth-tax-tax-business">here</a>, <a href="https://www.cato.org/publications/policy-analysis/exploring-wealth-inequality">here</a>, and <a href="https://www.cato.org/publications/tax-budget-bulletin/taxing-wealth-capital-income">here</a>. </span></p> <div data-embed-button="embed" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="f4a5c0ba-91cf-4490-8789-fbcfbe324260" data-langcode="en" class="embedded-entity"> <div class="embed embed--youtube js-embed js-embed--youtube"> <div class="responsive-embed"> </div> </div> </div> Fri, 24 Jan 2020 16:12:04 -0500 Chris Edwards https://www.cato.org/blog/wealth-business-ownership U.S. Ferry Systems Soaked by Maritime Protectionism https://www.cato.org/blog/ferry-systems-soaked-maritime-protectionism <p><a href="https://www.cato.org/people/colin-grabow" hreflang="und">Colin Grabow</a></p> <div data-embed-button="image" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="e3022cb4-ed8e-4ff8-b1e7-3275a931372c" class="align-center embedded-entity" data-langcode="en"> <p><img srcset="/sites/cato.org/files/styles/pubs/public/2020-01/washington%20state%20ferries.jpg?itok=CwMQTZNt 1x, /sites/cato.org/files/styles/pubs_2x/public/2020-01/washington%20state%20ferries.jpg?itok=ttjwCH2K 1.5x" width="700" height="467" src="https://www.cato.org/sites/cato.org/files/styles/pubs/public/2020-01/washington%20state%20ferries.jpg?itok=CwMQTZNt" alt="Washington State Ferries" typeof="Image" class="component-image" /></p></div> <p><span>Some of the country’s leading ferry systems are facing an increasingly precarious outlook. In Alaska, <a href="https://www.adn.com/politics/2020/01/18/gov-dunleavy-orders-panel-to-recommend-alaska-ferries-future/">questions</a> loom over the state‐​run ferry system’s future after the governor and legislature last year endorsed <a href="https://www.juneauempire.com/news/deep-ferry-cuts-on-verge-of-going-through/">paring</a> <a href="https://www.alaskapublic.org/2019/08/20/dunleavy-vetoes-ferry-funding-added-by-the-legislature-in-the-wake-of-cuts/">back</a> massive subsidies needed to keep it afloat. In Washington state, meanwhile, a spokesman for Washington State Ferries (WSF) last March <a href="https://www.seattletimes.com/seattle-news/as-ferry-system-is-hanging-by-a-thread-lawmakers-debate-transportation-budgets-to-fund-new-boats/">described</a> the ferry system — plagued by old vessels and a numerically insufficient fleet — as “hanging by a thread.” Users of the government‐​operated ferries <a href="https://komonews.com/news/local/double-whammy-state-ferry-fares-go-up-then-go-up-again">were hit</a> with a fare increase in October and will face another this May.</span></p> <p><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span>These struggles can be at least partially explained by protectionist U.S. maritime laws. Ferries transporting vehicles — which is most such vessels in Alaska and Washington — are subject to the 1920 <a href="https://cato.org/jonesact">Jones Act</a>, while those transporting people fall under the Passenger Vessel Services Act of 1886. Both laws mandate that vessels engaged in domestic transport be U.S.-built.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span>Politicians in Olympia, meanwhile, have worsened matters by mandating that WSF vessels not only be U.S.-built but constructed in Washington state. Not coincidentally, the Washington State Institute for Public Policy <a href="http://www.wsipp.wa.gov/ReportFile/1649/Wsipp_Washington-State-Ferry-Vessel-Procurement_Report.pdf">points out</a> that the state has “received only one to two bids on all new ferries constructed in the last 30 years.” That may be a windfall for Vigor Industrial’s <a href="https://vigor.net/facilities/seattle">Seattle shipyard</a> that has won most of these contracts, but it’s a kick in the teeth to everyone else.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span>Forcing vessels to be purchased from coddled and uncompetitive U.S. shipyards means unnecessarily higher prices. Indeed, a <a href="https://hidot.hawaii.gov/wp-content/uploads/2018/01/DOT-Feasibility-Study-on-Inter-Island-and-Intra-Island-Ferry-Systems-December-2017.pdf">2017 study</a> by the Hawaii Department of Transportation into the feasibility of establishing a ferry system noted that the cost of vessel construction in the United States can be “significantly larger” than those built abroad.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p> <p><span>Hawaii would certainly know.</span></p> <p><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span>In 2004 a company called Hawaii Superferry signed <a href="https://www.marinelink.com/news/contract-hawaii-austal323827">a contract</a> with Australia‐​headquartered Austal to build two catamaran ferries at its Alabama shipyard for <a href="http://www.professionalmariner.com/April-2012/Two-former-Hawaii-Superferry-catamarans-added-to-Navy-fleet/">$178 million</a>, or $89 million each ($123 million in 2019 dollars). In comparison, Austal announced last year that it was building a new catamaran ferry at one of its non‑U.S. shipyards for </span></span></span></span></span></span></span></span></span></span></span></span></span></span></span><a href="https://www.austal.com/news/new-115-metre-high-speed-catamaran-molslinjen-largest-ferry-be-built-austal">€</a><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><a href="https://www.austal.com/news/new-115-metre-high-speed-catamaran-molslinjen-largest-ferry-be-built-austal">83.65 million</a> or approximately $93 million. That’s tens of millions of dollars less for a vessel with <em>twice the passenger and vehicle capacity</em>. </span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p> <p><span>Another Austal ferry with a similar capacity as the Hawaii Superferry vessels, the <em><a href="https://www.austal.com/ships/spirit-ontario-tanger-jet-ii-dolphin-jet">Spirit of Ontario<span>,</span></a></em> was delivered in 2004 for <a href="https://www.nytimes.com/2004/10/26/nyregion/from-the-first-rochester-ferry-was-burdened-by-failings-in-fine.html">$42 million</a>, or roughly half the cost of the U.S.-built ferries. </span></p> <p><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span>That local build requirements result in higher costs cannot be disputed. That, after all, is the entire point of such laws. If U.S. or Washington shipyards were able to compete on price then such measures would not exist.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span>Maritime protectionism’s toll, however, does not stop with more expensive vessels. Faced with eye‐​popping acquisition costs, ferry systems often employ existing vessels well past their normal lifespan (WSF did not retire its 1927‐​built Steel Electric‐​class vessels until 2007, a full <em>eighty years </em>after they were built when their hand was suddenly forced by <a href="http://www.professionalmariner.com/December-January-2008/80-year-old-Puget-Sound-ferries-forced-out-of-service-by-cracks-in-their-hulls/">recurring cracks</a> in the hulls). An aging fleet, in turn, leads to higher maintenance expenditures as the vessels inevitably degrade. As a <a href="https://www.wsdot.wa.gov/ferries/assets/WSF2019AlternateServicePlan.pdf">2019 report</a> from the Washington Department of Transportation notes:</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p> <blockquote><p><span><span><span><em>The </em>[WSF]<em> fleet has an average age of 29 years. Twelve of our remaining 22 ferries are more than 30 years old. Of those, four are at least 50 years old. This aging fleet requires more maintenance to deal with problems such as steel corrosion, replacing or repairing obsolete equipment, and preservation projects that have been deferred, leading to a higher risk of vessel breakdown.</em></span></span></span></p> </blockquote> <p><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span>A 45‐​year‐​old ferry in the Alaska Marine Highway System, the <em>LeConte</em>, offers a recent example. Sent for an overhaul last October, workers discovered <a href="https://www.alaskapublic.org/2019/11/22/alaska-dot-leconte-ferry-repairs-to-take-six-months-fate-of-sister-ship-aurora-unclear/">$4 million</a> in additional work that had to be performed. A 56‐​year‐​old ferry undergoing service around the same time, the <em>Malaspina</em>, rang up a <a href="https://www.alaskapublic.org/2019/10/24/facing-a-16-million-repair-bill-state-to-pull-malaspina-ferry-out-of-service/">$16 million</a> repair bill. </span></span></span></span></span></span></span></span></span></span></span></span></span></span></span>Saltwater <a href="https://sciencing.com/effects-saltwater-metals-8632636.html">is tough</a> on steel.</span></p> <p><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span>These costly‐​to‐​purchase, costly‐​to‐​maintain vessels have to be paid for somehow. That means either more taxpayer‐​funded subsidies (all taxpayers in the case of Alaska — a new $244 million ferry is slated to be paid for with <a href="https://www.alaskajournal.com/2017-06-14/marine-highway-supporters-look-new-ideas-amid-challenges">$222 million</a> in federal dollars), higher fares, reduced service, or a combination thereof.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span>There’s a better way.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p> <figure role="group" class="align-center filter-caption"><div data-embed-button="image" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="434d1220-5989-4d93-9916-89332be3f914" data-langcode="en" class="embedded-entity"> <p><img srcset="/sites/cato.org/files/styles/pubs/public/2020-01/coastalinspirationbowportaerial.jpg.jpg?itok=t7hUUbEC 1x, /sites/cato.org/files/styles/pubs_2x/public/2020-01/coastalinspirationbowportaerial.jpg.jpg?itok=aXycFY8i 1.5x" width="700" height="525" src="https://www.cato.org/sites/cato.org/files/styles/pubs/public/2020-01/coastalinspirationbowportaerial.jpg.jpg?itok=t7hUUbEC" alt="Coastal Inspiration" typeof="Image" class="component-image" /></p></div> <figcaption><div class="figure-caption text-sans-alternate">BC Ferries’ German‐​built Coastal Inspiration ferry </div> </figcaption></figure><p><span>Like their neighbors in Alaska and Washington, British Columbia is also home to large ferry system called BC Ferries. Indeed, <a href="https://www.bcferries.com/onboard-experiences/fleet">its fleet</a> is actually more numerous than that of Alaska and Washington’s ferry systems combined. Unlike WSF and the Alaska Marine Highway System, however, BC Ferries<span> can shop internationally for its vessels. As a</span> <span>result, they are typically purchased <a href="https://dailyhive.com/vancouver/bc-ferries-island-class-hybrid-electric-ships-video">from</a><a href="https://biv.com/article/2017/05/third-and-final-salish-class-ferry-its-way-bc-pola"> European</a></span> <span><a href="http://www.professionalmariner.com/December-January-2008/Coastal-Renaissance-German-precision-for-Canadian-waters/">shipyards</a><span><span><span><span><span><span><span><span> </span></span></span></span></span></span></span></span><span><span><span><span><span><span><span><span>where BC Ferries receives far more value for its money. Limiting BC Ferries to Canadian shipyards, explains CEO Mark Collins, would force it to pay prices </span></span></span></span></span></span></span></span><a href="https://www.vancouverisawesome.com/transportation/bc-ferries-building-vessels-overseas-low-fares-1942702">30</a></span><a href="https://www.vancouverisawesome.com/transportation/bc-ferries-building-vessels-overseas-low-fares-1942702"> <span>–</span> </a><span><a href="https://www.vancouverisawesome.com/transportation/bc-ferries-building-vessels-overseas-low-fares-1942702">50 percent</a><span><span><span><span><span><span><span><span> higher for the vessels it buys</span></span></span></span></span></span></span></span> <span>—</span> <span>and result in a</span> <span>25 percent fare hike. </span></span></span></p> <p><span><span><span>This alternative scenario is the reality faced by U.S. ferry systems as a result of the Jones Act and similar laws.</span></span></span></p> <p><span><span><span>Such protectionism is not only a disservice to taxpayers but harmful to the U.S. maritime sector itself. By raising the cost of waterborne transport such policies discourage Americans, the inhabitants of a country laced with mighty rivers and thousands of miles of coastline, from fully unlocking their maritime bounty. And it’s hardly been a boon to U.S. commercial shipbuilding, which<span><span><span><span><span><span><span><span><span><span><span><span><span>—</span></span></span></span></span></span></span></span></span></span></span></span></span>denied the tough competition which invigorates other sectors of the economy<span><span><span><span><span><span><span><span><span><span><span><span><span>—has fallen <a href="https://www.cato.org/publications/policy-analysis/rust-buckets-how-jones-act-undermines-us-shipbuilding-national">well behind</a> its international counterparts.</span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span><span>To fix the ills of U.S. ferries, as well as the broader maritime industry, repeal or serious reform of maritime protectionism must be firmly on the table. </span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></span></p> Fri, 24 Jan 2020 12:48:04 -0500 Colin Grabow https://www.cato.org/blog/ferry-systems-soaked-maritime-protectionism The Laughable “Security” Justification for Cracking Down on Birth Tourism https://www.cato.org/blog/laughable-security-justification-cracking-down-birth-tourism <p><a href="https://www.cato.org/people/david-bier" hreflang="und">David Bier</a></p> <p>The U.S. Department of State announced <a href="https://s3.amazonaws.com/public-inspection.federalregister.gov/2020-01218.pdf">a&nbsp;new rule</a> for tourist visa applicants today: prove you’re not going to give birth in America. The rule will not protect national security, will create more fraud and crime, and will cost America people who will contribute productively to this nation.</p> <p>The tourist visa statute allows noncitizens to visit the United States for “pleasure,” which State has always <a href="https://www.law.cornell.edu/cfr/text/22/41.31">interpreted</a> to mean “legitimate activities of a&nbsp;recreational character, including tourism, amusement, visits with friends or relatives, rest, medical treatment, and activities of a&nbsp;fraternal, social, or service nature.” — in other words, most anything. But now, “The Department is revising the definition of ‘pleasure’” (p. 2) to exclude giving birth in the United States.</p> <p>The State Department asserts that the “rule addresses concerns about the attendant risks of this activity to national security.”</p> <blockquote><p>The previous regulation failed to address the national security vulnerability that could allow foreign governments or entities to recruit or groom U.S. citizens who were born as the result of birth tourism and raised overseas, without attachment to the United States, in manners that threaten the security of the United States.</p> </blockquote> <p>The State Department not only doesn’t present any evidence that this is occurring or has ever occurred, but it doesn’t even explain what the threatening “manners” might be that could somehow harm America. It can’t even imagine a&nbsp;hypothetical scenario to give flesh and bones to nightmare. The evidence that it does provide is that “Birth tourism <em>companies</em> advertise their <em>businesses</em> abroad by promoting the citizenship‐​related benefits of giving birth in the United States” (emphasis added). In other words, these are capitalist enterprises led by the market, not governmental efforts led by foreign security agencies.</p> <p>I <a href="https://www.cato.org/publications/policy-analysis/extreme-vetting-immigrants-estimating-terrorism-vetting-failures">have dug</a> through hundreds of national security and terrorism cases over a&nbsp;30‐​year period to identify the origins of the offenders, and not a&nbsp;single case that I&nbsp;have reviewed followed this fact pattern.</p> <p>The State Department lists the following reasons for people choosing to give birth in the United States:</p> <blockquote><p>obtaining a&nbsp;second citizenship for their child, the perceived low‐​cost medical services available to women in the United States, the lower cost of obtaining U.S. citizenship through birth tourism than through a&nbsp;U.S. investor visa, and the perceived guarantee of a&nbsp;better socioeconomic future for their child.</p> </blockquote> <p>Not included on this list: developing stealth agents to (somehow) undermine America.</p> <p>It’s also interesting&nbsp;that the State Department didn’t include the evasion of China’s 1‑child/​<a href="https://en.wikipedia.org/wiki/Two-child_policy">2‑child policy</a>. One woman named Liou <a href="https://www.usatoday.com/story/news/2015/03/03/california-chinese-birth-tourism-raids/24338087/">said</a> in 2015 that she only came to the United States to “skirt China’s one‐​child policy” and will return to China after giving birth. The reason is that the child limit only applies to children born in mainland China. A&nbsp;Shanghai reporter <a href="https://www.bloomberg.com/opinion/articles/2011-11-03/china-s-birth-tourism-isn-t-about-the-u-s-adam-minter">assessed the situation</a> this way in 2011:</p> <blockquote><p>American journalists continue to generate stories about birth tourists from China, most often explaining them as seekers of the American dream. They rarely touch on what the Chinese people, and their media, know is a&nbsp;leading cause of the phenomenon: an attempt to evade the Chinese government’s population controls.</p> </blockquote> <p>This explains why — as I&nbsp;<a href="https://www.niskanencenter.org/chinese-mothers-give-birth-in-the-u-s-to-thwart-chinas-one-child-policy/">described in 2015</a>—out‐​of‐​county births to mainland Chinese have spiked all around the world, not just in the United States. You would think that the State Department would want to treat people thwarting Chinese totalitarianism as potential allies, rather than threats. Obviously, these women choose to give birth in the United States rather than elsewhere because they believe their children could benefit from having the option to come and live here, but it takes a&nbsp;bizarre sort of nativist paranoia to see this aspiration for the American dream as a&nbsp;threat rather than an opportunity.</p> <p>The State Department cites a&nbsp;few instances of birth tourism companies defrauding immigrants, hospitals, and property owners, but those actions are already illegal and this rule does nothing to stop fraud. Indeed, by banning this activity, this rule will inevitably push the industry underground and lead to more fraud. Far from protecting women seeking to give birth here, it will place them in much more vulnerable situations.</p> <p>This rule has no justification other than a&nbsp;desire to keep out foreigners. Indeed, it repeatedly cites the fear that parents of the child could eventually receive green cards when their children reach adulthood. That’s not a&nbsp;fear any reasonable person would treat as a&nbsp;security threat. In fact, the State Department notes that the birth tourists are hoping their children will eventually return to contribute to America. How is this a&nbsp;problem?</p> <p>The State Department is denying the public the ability to comment on the rule before it becomes finalized — as all other rules must do — because it wants to avoid having to “respond publicly to pointed questions regarding foreign policy decisions.” It must be nice to have the power to harm the lives of tens of thousands of peaceful people, all without the fear of having to answer any questions about it.</p> Thu, 23 Jan 2020 14:00:22 -0500 David Bier https://www.cato.org/blog/laughable-security-justification-cracking-down-birth-tourism 13 Virginia Republican Senators Stand Like a Stone Wall against Gay Marriage https://www.cato.org/blog/13-virginia-republican-senators-stand-stone-wall-against-gay-marriage <p><a href="https://www.cato.org/people/david-boaz" hreflang="und">David Boaz</a></p> <p>In 2006, 57 percent of&nbsp;Virginia voters voted to add an amendment to the state constitution to ban gay marriage. There was of course no same‐​sex marriage law in Virginia at the time; and in a&nbsp;state with a&nbsp;Republican legislature and judges appointed by that legislature, there was no prospect of change. But conservatives still insisted that the threat was so severe that a&nbsp;ban must be added to the constitution.</p> <p>Virginia’s marriage ban was more sweeping than in other states. Lawyers at the firm of Arnold and Porter issued a&nbsp;<a href="https://object.cato.org/sites/cato.org/files/pubs/pdf/arnold-and-porter-memo.pdf" target="_blank">71‐​page analysis of the amendment</a> which concluded that the amendment could be interpreted by Virginia courts to invalidate rights and protections currently provided to unmarried couples under domestic violence laws, block private companies from providing employee benefits to domestic partners, and prevent the courts from enforcing child custody and visitation rights, as well as end‐​of‐​life arrangements, such as wills, trusts and advance medical directives, executed by unmarried couples.</p> <p>The firm went on to say: “This exceedingly broad and untested language is the most expansive such proposal ever to have been put before the voters of any state.”</p> <p>Nevertheless, the voters approved the amendment. In a&nbsp;few years attitudes had changed. Polls in 2012, just six years later, <a href="https://www.cato.org/blog/gay-marriage-swing-states">found</a> that Virginians supported gay marriage by 9&nbsp;points. But a&nbsp;constitutional amendment is hard to change when attitudes change.</p> <p>Then in 2015 the Supreme Court struck down bans on gay marriage, requiring all states to perform and recognize the marriages of same‐​sex couples on the same terms and conditions as the marriages of opposite‐​sex couples. Virginia’s constitutional provision was thus unconstitutional and unenforceable. (In fact, the Virginia ban had <a href="https://www.nbc12.com/story/26713164/same-sex-marriage-now-legal-in-virginia/">ended</a> on October 6, 2014, when the Fourth Circuit Court of Appeals struck down Virginia’s law.)</p> <p>In 2016 and 2018, Virginia state senator Adam Ebbin introduced legislation to take the ban on same‐​sex marriage out of the state code. Republican majorities blocked the bills.&nbsp;</p> <p>And this week, in 2020, almost six years after the law was declared unconstitutional and unenforceable, and two months after Democrats took control of the legislature, the Virginia Senate <a href="https://www.washingtonpost.com/local/virginia-politics/lbgt-bills-clear-virginia-senate-and-heads-to-a-friendly-house-of-delegates/2020/01/21/931c3fe2-3c88-11ea-8872-5df698785a4e_story.html">passed</a> Senator Ebbin’s bill by a&nbsp;vote of 25 to 13. Five Republicans joined the majority. Two, including the minority leader, did not vote. But 13 Republican senators, to use a&nbsp;hallowed Virginia phrase, stood like a&nbsp;stone wall against reality and voted no.&nbsp;</p> <p>The bill is expected to pass the now‐​Democratic House of Delegates and be signed by the governor.&nbsp;</p> Thu, 23 Jan 2020 13:49:18 -0500 David Boaz https://www.cato.org/blog/13-virginia-republican-senators-stand-stone-wall-against-gay-marriage The Gordon Liddy Model of Impeachment Defense https://www.cato.org/blog/gordon-liddy-model-impeachment-defense <p><a href="https://www.cato.org/people/gene-healy" hreflang="und">Gene Healy</a></p> <p>G. Gordon Liddy: now <em>there</em> was a man willing to take a bullet for his president! In his autobiography, <em>Will</em>, the former White House “Plumber” <a href="https://twitter.com/GeneHealy/status/1219003470759571458?s=20">recounts</a> the following conversation with White House counsel John Dean after the Watergate caper went bust:</p> <figure role="group" class="align-right filter-caption"><div data-embed-button="image" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="0b7d512f-d5e5-4d90-8c39-83706d4bb653" data-langcode="en" class="embedded-entity"> <p><img srcset="/sites/cato.org/files/styles/pubs/public/2020-01/IMG_0103.jpg?itok=Yz-KG5ZB 1x, /sites/cato.org/files/styles/pubs_2x/public/2020-01/IMG_0103.jpg?itok=ckWiT7WU 1.5x" width="320" height="285" src="https://www.cato.org/sites/cato.org/files/styles/pubs/public/2020-01/IMG_0103.jpg?itok=Yz-KG5ZB" alt="The Liddy Model of Impeachment Defense" typeof="Image" class="component-image" /></p></div> <figcaption><div class="figure-caption text-sans-alternate">“Just tell me what corner to stand on, Mr. President!” </div> </figcaption></figure><blockquote><p>Liddy: “If someone wants to shoot me, just tell me what corner to stand on and I’ll be there, OK?”</p> <p>Dean: “well, uh — I don’t think we’ve gotten <em>there</em> yet, Gordon.”</p> <p>Liddy: “All right. But please remember what I said.”</p> <p>Dean: “Believe me, Gordon, I will.”</p> </blockquote> <p>President Trump’s copartisans in Congress may not be up for the literal <a href="https://www.realclearpolitics.com/video/2016/01/23/trump_i_could_stand_in_the_middle_of_fifth_avenue_and_shoot_somebody_and_i_wouldnt_lose_any_voters.html">Fifth‐​Avenue</a> drive‐​by, but, metaphorically at least, they’ve embraced the Gordon Liddy Model of Impeachment Defense. Trump has but to say the word, and a distressingly large swathe of the GOP caucus will frogmarch their reputations to the appointed street corner for destruction.</p> <p>December’s House debate is exhibit A; I covered some of the lowlights in the <em>Hill </em>last week: <a href="https://thehill.com/blogs/congress-blog/politics/478418-the-five-dumbest-things-said-about-impeachment-so-far">“The five dumbest things said about impeachment so far”</a> (runners‐​up <a href="https://mikejohnson.house.gov/sites/mikejohnson.house.gov/files/A%20QUICK%20CRITIQUE%20OF%20THE%20IMPEACHMENT%20SHAM%20%28Rep.%20Mike%20Johnson%29.pdf?fbclid=IwAR0rsrTh--nCqR0shDBB43sennDKvEneXtNJRuKyDulgGbuwYA2q3NDT8YI">here</a>). But before we get too far into the Senate trial, I want to look back at a key part of the House debate: the GOP’s “dissenting views” in the <a href="https://rules.house.gov/sites/democrats.rules.house.gov/files/CRPT-116hrpt346.pdf">House Judiciary Committee Impeachment Report</a>. It’s right there, starting on page 181, that you get a sense of just how far Republican standards have fallen.</p> <p>It is entirely possible to make a solid case against Trump’s impeachment without beclowning oneself. But that case has to begin with an acknowledgment that Trump’s asking for an investigation — or the public announcement of one — into his leading 2020 rival, at least looks a <em>little</em> funny. What’s clear from the HJC Report is that the GOP dissenters didn’t dare dissent from the president’s self‐​assessment that his July 25 parley with President Zelensky was <a href="https://twitter.com/realdonaldtrump/status/1177604833538392065?lang=en">a “perfect call.”</a></p> <p>Instead, <a href="https://www.foxnews.com/politics/rep-collins-slams-formal-impeachment-inquiry-against-trump">Rep. Doug Collins</a>, ranking Republican on the House Judiciary Committee insists there was “nothing untoward about a president asking a foreign government to investigate” the Bidens’ role in Ukraine. Trump was just trying to smoke out “potential corruption”; that the target happened to be his likely 2020 opponent was a happy accident, apparently. In his separate <a href="https://mikejohnson.house.gov/sites/mikejohnson.house.gov/files/A%20QUICK%20CRITIQUE%20OF%20THE%20IMPEACHMENT%20SHAM%20%28Rep.%20Mike%20Johnson%29.pdf?fbclid=IwAR0rsrTh--nCqR0shDBB43sennDKvEneXtNJRuKyDulgGbuwYA2q3NDT8YI">dissent</a>, Rep. Mike Johnson (R‑LA) bellows in chain‐​email ALLCAPS: I’ll tell you “WHY THIS IMPEACHMENT IS A SHAM”! It’s because there’s “zero proof” that “President Trump was pursuing ‘personal benefit’” in the call: “To the contrary, the record is clear that he had exactly the opposite in mind.” But, as Conor Friedersdorf <a href="https://twitter.com/conor64/status/1212585129559769088?s=20">put the point</a> a few weeks ago: “when a president says he is motivated by the public purpose of anti‐​corruption, but he only targets the guy polling best against him, AND pushes for the announcement of an investigation more than the thing itself, we should refrain from being credulous naifs.”</p> <p>It’s instructive to compare the GOP dissents with the “Minority Views” filed in the Clinton and Nixon committee reports. The Democratic dissenters to the <a href="https://www.congress.gov/105/crpt/hrpt830/CRPT-105hrpt830.pdf">Clinton impeachment report</a> managed to argue against removal without braying “READ THE [Grand Jury] TRANSCRIPT!” and insisting that Bubba was utterly without sin. Likewise, the Judiciary Committee Republicans who opposed Nixon’s impeachment never stooped to: “move along: nothing to see here!”</p> <p>The closest parallel to the “abuse of power” charge against Trump (<a href="https://www.nytimes.com/interactive/2019/12/10/us/politics/articles-impeachment-document-pdf.html">Article 1</a>) can be found in the second article of impeachment against Nixon, passed by the House Judiciary Committee in July 1974 (remember, Nixon quit before the full House could vote). <a href="https://twitter.com/GeneHealy/status/1180147283188428800?s=20">The first offense</a> it enumerates is the president’s attempt to turn the IRS against his political rivals, principally staffers and contributors to Senator George McGovern’s presidential campaign.</p> <p><a href="https://urldefense.com/v3/__https:/madison.com/wsj/news/local/govt-and-politics/ron-johnson-nothing-wrong-with-donald-trump-asking-china-to/article_0b669f54-9ddc-586d-858e-3c01d7cf4b62.html__;!c3kmrbLBmhXtig!9jPIJmfGRK8hFyUnr-IVjztkhoM6zSfeLEXFijeqafcKhNzQwLUFw2FgOzbUvUyKbjSgWZWY9g$">Nothing wrong</a> with<a href="https://urldefense.com/v3/__https:/www.politico.eu/article/mike-pompeo-donald-trump-ukraine-phone-call-athens-corruption/__;!c3kmrbLBmhXtig!9jPIJmfGRK8hFyUnr-IVjztkhoM6zSfeLEXFijeqafcKhNzQwLUFw2FgOzbUvUyKbjSnpJ9ArA$"> asking for an investigation</a>, right? Some of McGovern’s people probably were tax cheats, and you’ve got to start draining the swamp somewhere! Nobody at the time thought that passed the straight‐​face test, however. Notably, that included the 10 Republicans who <a href="https://watergate.info/impeachment/analysis-judiciary-committee-impeachment-votes">voted against Nixon Article 2</a>. In a lengthy dissenting opinion to the 1974 Judiciary Committee Report on <a href="https://www.govinfo.gov/content/pkg/GPO-CDOC-106sdoc3/pdf/GPO-CDOC-106sdoc3-19-7.pdf">“Impeachment of Richard M. Nixon,”</a> they explain their reasons for rejecting the “Abuse of Power” charges. Unlike their 2019 counterparts, they managed to dissent with <a href="https://youtu.be/NJwsRfiwvY4">a modicum of dignity</a>.</p> <p>“Our opposition to the adoption of Article II should not be misunderstood as condonation of the presidential conduct alleged therein,” they write, “On the contrary, we deplore in strongest terms the aspects of presidential wrongdoing to which the Article is addressed.” Still, the Republican dissenters argue, the administration’s efforts to force political audits were “ineffectual,” ultimately unsuccessful, and the president’s direct involvement had not been conclusively proven. That said, the attempt to turn the IRS against McGovern supporters was “reprehensible,” they acknowledge, and concede that if the president supported that effort, he could have been subject to censure, if not impeachment. I don’t find the Nixon‐​era GOP’s arguments against Article 2 compelling. But at least the defense they mounted wasn’t embarrassingly servile.</p> <p>“I need <a href="https://www.politico.com/magazine/story/2018/03/06/donald-trump-loyalty-staff-217227">loyalty</a>. I expect loyalty,” President Trump has said. On impeachment, that means not simply opposing removal, but Total Commitment — doing it <em>his </em>way. “Some G.O.P. lawmakers who initially said Mr. Trump’s phone call with the president of Ukraine was inappropriate later dropped their criticism,” having <a href="https://www.nytimes.com/2019/12/21/us/politics/trump-impeachment-republicans.html">gotten the message</a> that it wouldn’t be prudent. “Profiles in Courage” are vanishingly rare in the upper chamber; but can’t Senate Republicans do better than this?</p> Thu, 23 Jan 2020 10:14:52 -0500 Gene Healy https://www.cato.org/blog/gordon-liddy-model-impeachment-defense Florida E‑Verify Bills Are a Stealth E‑Verify Mandate for Private Business https://www.cato.org/blog/florida-e-verify-bills-are-stealth-e-verify-mandate-private-business <p><a href="https://www.cato.org/people/alex-nowrasteh" hreflang="und">Alex Nowrasteh</a></p> <p>Florida state Representative Cord Byrd (R) and state Senator Joe Gruters (R) recently introduced <a href="https://www.flsenate.gov/Session/Bill/2020/1822">bills</a> that would impose a&nbsp;stealth universal E‑Verify mandate on all new hires in their state. Many in the media are reporting their bills as a&nbsp;<a href="https://floridapolitics.com/archives/315548-possible-e-verify-compromise-emerges">compromise</a> that will subject state employers to E‑Verify (even though former Governor Rick Scott <a href="https://www.flgov.com/wp-content/uploads/2011/01/scott.eo_.two_.pdf">signed an executive order that already subjects them to E‑Verify</a>), but that will not mandate E‑Verify for private employers.</p> <p>That is simply not true.</p> <p>The bills are a&nbsp;stealth universal E‑Verify mandate. They would force all private employers to either use E‑Verify or a&nbsp;second means of work authorization by January 1, 2021. That second means of work authorization is a&nbsp;more onerous version of the current federal I‑9 requirement that would force the worker to provide a&nbsp;picture identification compliant with the REAL ID Act <em>and</em> one of the following CERTIFIED documents to his or her new employer: birth certificate, certification of naturalization, a&nbsp;certification of citizenship, an alien registration receipt card, or an immigration I‑94 form stamped “employment authorized.” The employer would then have to keep a&nbsp;copy of the certified document on file.</p> <p>A certified copy means, in the case of a&nbsp;birth certificate, that it needs to have the “<a href="https://www.thoughtco.com/get-copy-of-your-birth-certificate-3321075">official state registrar’s raised, embossed, impressed or multicolored seal, registrar’s signature, and the date the certificate was filed with the registrar’s office, which must be within one year of the person’s date of birth</a>.” A&nbsp;mere photocopy of a&nbsp;birth certificate would not suffice. I&nbsp;just tried to order a&nbsp;certified birth certificate from Florida under the online credit card payment option from Miami‐​Dade county. The fee was $37.&nbsp;A $37 tax on workers for getting a&nbsp;new job isn’t consistent with Governor DeSantis’ <a href="https://www.flgov.com/2019/10/08/governor-ron-desantis-announces-bold-occupational-licensing-reform-agenda/">laudable efforts</a> to reduce regulatory barriers to higher employment elsewhere in Florida.</p> <p>Another curious provision of the E‑Verify bills is that they recognize fewer documents as evidence of lawful residence and work authorization than <a href="https://www.uscis.gov/i-9">federal I‑9 requirements</a> do. For instance, the Florida E‑Verify bills do not include a&nbsp;U.S. Passport or Passport Card as evidence of legal residence and work authorization. The bill says that the “private employer must retain a&nbsp;copy of the documents provided under this subparagraph for at least 3&nbsp;years after the person’s initial date of employment,” which I&nbsp;assume means that the employer will not have to keep the actual certified document itself. So why should a&nbsp;U.S. Passport not be allowed – unless the bill actually intends that the certified original document must be held by the employer?</p> <p>If the second suped‐​up I‑9 option for worker identification in the Florida bill was just a&nbsp;word‐​for‐​word recreation of the federal I‑9 requirement that currently burdens American employers with at least <a href="https://www.cato.org/www.gpo.gov/fdsys/pkg/FR-2012-03-27/pdf/2012-7299.pdf">13.5 million annual man‐​hours</a> of checking and filing government forms, that would be one thing. Such a&nbsp;requirement would be redundant to current federal law and wouldn’t add any additional regulatory burden. <em>Presenting</em> a&nbsp;passport and, at most, requiring the employer to keep a&nbsp;photocopy should be more than sufficient.</p> <p>There is no reason to shrink the number of available documents that employers can use to verify work eligibility unless the intent is to make the alternative suped‐​up I‑9 more burdensome for workers and employers, with the ultimate intent to push as many employers as possible into using E‑Verify. With such a “choice,” where employers must pick either E‑Verify or a&nbsp;suped‐​up I‑9 that also burdens their new hires, most businesses and employees will “choose” E‑Verify. Thus, Floridians will be burdened with a&nbsp;universal E‑Verify mandate sold as a&nbsp;compromise non‐​mandate because the other second option of a&nbsp;suped‐​up I‑9 is relatively more onerous.</p> <p>Even weirder, the bills require a&nbsp;REAL ID‐​compliant form of photo identification. A&nbsp;resident of <a href="https://www.flhsmv.gov/driver-licenses-id-cards/what-to-bring/u-s-citizen/">Florida can get a&nbsp;REAL </a>ID‐​compliant form of photo identification by showing a&nbsp;valid U.S. Passport or Passport Card along with another form of identification, such as a&nbsp;Social Security card, along with evidence of residency in Florida. If a&nbsp;native‐​born American worker can get a&nbsp;REAL ID‐​compliant drivers license in Florida with a&nbsp;U.S. Passport and a&nbsp;Social Security card, he or she should also be able to get a&nbsp;job by showing those documents to their new employer. It should be <em>at least </em>as easy to get a&nbsp;job as it is to go through the TSA line at the airport.</p> <p>These bills are not a&nbsp;good‐​faith compromise, they will create an E‑Verify mandate. If Byrd and Gruters want to give DeSantis a&nbsp;political win without imposing an E‑Verify mandate, they should just recreate the I‑9 requirements word‐​for‐​word on the state level. E‑Verify shouldn’t even be on the table at this point.</p> <p>In addition to the recent bills that would impose a&nbsp;stealth E‑Verify mandate in Florida, a&nbsp;new <a href="https://www.nber.org/papers/w26676?utm_campaign=ntwh&amp;utm_medium=email&amp;utm_source=ntwg2">NBER working paper</a> by economists Shalise Ayromloo, Benjamin Feigenberg, and Darren Lubotsky shows why such a&nbsp;mandate would be unwise. They found that an E‑Verify mandate reduces the employment and wages of illegal immigrants as the proponents of those laws desire. However, E‑Verify also does not reduce the illegal immigrant population in states where it is mandated nor does it open up jobs for native‐​born Americans, especially lower‐​skilled Americans. At best, E‑Verify somewhat delivers on one of its three promises.</p> <p>According to Tables 4&nbsp;and 10&nbsp;in their <a href="https://www.nber.org/papers/w26676?utm_campaign=ntwh&amp;utm_medium=email&amp;utm_source=ntwg2">paper</a>, E‑Verify reduces the employment of illegal immigrants by 19 percent (significant at the 1% level) and their per capita wage income by 26.3 percent (significant at the 5% level). However, they also find that E‑Verify reduces the employment of native‐​born American high school dropouts by 2.7 percent (significant at the 5% level) and young male native‐​born American high school dropouts by 6.8 percent (significant at the 1% level). E‑Verify cuts the per capita wage income of all natives by 3.6 percent, native dropouts by 4.5 percent, and young male native high‐​school dropouts natives by 7.7 percent – all significant at the 5% level.</p> <p>In other words, E‑Verify lowers wages and employment for illegal immigrant and low‐​skilled native‐​born Americans. Among native‐​born Americans, the especially negative effects are concentrated on the lowest‐​skilled American men who can least afford to pay for E‑Verify’s regulatory burden. Proponents of E‑Verify frequently state that it is a “<a href="https://www.c-span.org/video/?463451-4/washington-journal-mark-krikorian-discusses-verify">free</a>” government program. That is not true. In addition to the taxpayer costs of running E‑Verify, it also levies a&nbsp;heavy tax on the least skilled American workers.</p> <p>The paper also finds that the cost of an E‑Verify mandate disproportionately falls on larger firms because small firms are much less likely to comply with E‑Verify mandates. This contrasts with what many of us have thought about the disparate negative economic impact of E‑Verify. As the authors explain, larger firms are more likely to comply with E‑Verify and smaller firms are not, so there is a&nbsp;slight shift in employment toward smaller firms that do not comply with the costly regulatory burden and away from bigger firms that do.</p> <p>Lastly, the most important finding in this new paper is that mandatory E‑Verify does not reduce the illegal immigrant population on the county level. The authors bury the figure for this result in the <a href="https://www.nber.org/papers/w26676?utm_campaign=ntwh&amp;utm_medium=email&amp;utm_source=ntwg2">appendix</a> (Figure A6). Although E‑Verify lowers employment and wages for illegal immigrants, it does not force them out of the state. Perhaps it disincentivizes new illegal immigrants from moving there, but that remains to be seen. E‑Verify sounds like it produces the worst possible outcomes: Lower illegal immigrant employment and wages, lower native‐​born employment and wages, and no decrease in the illegal immigrant population. Who could possibly think that artificially increasing the number of people who cannot work and who have lower wages thanks to E‑Verify is a&nbsp;good thing? Yet that is exactly what E‑Verify will do in Florida if these bills become law.</p> <p>The E‑Verify bills proposed in Florida are not a&nbsp;compromise in any meaningful sense of the word. The bills mandate E‑Verify for government agencies and contractors, which is already law in Florida thanks to an <a href="https://www.flgov.com/wp-content/uploads/2011/01/scott.eo_.two_.pdf">executive order</a> by Rick Scott. Worse, they create a&nbsp;stealth E‑Verify mandate for all new hires beginning on January 1, 2021. When “choosing” between E‑Verify and second more‐​intense I‑9 offered in the bills, just about everybody will choose E‑Verify. A&nbsp;universal E‑Verify mandate imposed through this means is still a&nbsp;universal E‑Verify mandate despite what its supporters say.</p> Wed, 22 Jan 2020 16:50:07 -0500 Alex Nowrasteh https://www.cato.org/blog/florida-e-verify-bills-are-stealth-e-verify-mandate-private-business More Evidence That “Ban the Box” Laws Don’t Work https://www.cato.org/blog/more-evidence-ban-box-laws-dont-work <p><a href="https://www.cato.org/people/walter-olson" hreflang="und">Walter Olson</a></p> <p>President Trump recently <a href="https://www.esrcheck.com/wordpress/2019/12/23/fair-chance-act-will-ban-the-box-in-u-s-government/">signed</a> a&nbsp;bill including a&nbsp;measure called the Fair Chance Act, which will restrict federal contractors from asking applicants about criminal records until after a&nbsp;conditional job offer is made. In a&nbsp;<a href="https://www.cato.org/blog/ban-box-statistical-discrimination">summary of the research</a> in this space last year, Peter Van Doren observed that <a href="https://www.overlawyered.com/?s=%22ban+the+box%22">“ban the box” laws</a> of this sort do not appear to work as intended. Now there is new evidence that they either fail of effect or harm the intended beneficiaries.</p> <p>A series of economic studies up to now <a href="https://twitter.com/jenniferdoleac/status/983036787898675200?lang=en">has found</a> not only a&nbsp;lack of statistical evidence for a&nbsp;positive effect from these laws, but even signs of a&nbsp;negative effect on the employment of young black men with no criminal records (because some employers will assume the worst if not allowed to ask; more from economist Jennifer Doleac of Texas A&amp;M <a href="http://jenniferdoleac.com/wp-content/uploads/2019/03/Doleac_testimony_BTB_2019.pdf">here</a> and <a href="http://jenniferdoleac.com/wp-content/uploads/2018/08/Doleac_Hansen_JOLE_preprint.pdf">here</a>). Despite this track record the laws have remained popular across the ideological spectrum, including some persons of generally free‐​market inclination. The unpromising outcomes have not deterred Congress from passing bills like the one enacted last fall, or city and state governments from extending such laws to private employers, often in <a href="https://www.overlawyered.com/2014/08/nyc-ban-box-bill-worries-businesses/">onerous ways</a>.</p> <p>Now Ryan Sherrard of the University of California, Santa Barbara economics department illuminates another part of the picture, recidivism, in a&nbsp;<a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3515048">new paper</a>. Advocates <a href="https://www.naacp.org/campaigns/ban-the-box/">routinely</a> <a href="https://www.congress.gov/116/meeting/house/109189/documents/HMKP-116-GO00-20190326-SD013.pdf">predict</a>, and cite as a&nbsp;major expected benefit, that ban the box laws will reduce re‐​offense rates. But Sherrard found no such effect. Relevant portion of abstract:</p> <blockquote><p>Using administrative prison data, this paper examines the direct effect of BTB policies on rates of criminal recidivism. I&nbsp;find that while BTB policies don’t appear to reduce criminal recidivism overall, these policies may be exacerbating racial disparities. In particular, I&nbsp;show that being released into a&nbsp;labor market with a&nbsp;BTB policy is associated with higher rates of recidivism for black ex‐​offenders, with little to no effect for white ex‐​offenders.</p> </blockquote> <p>It might sometimes make sense for government to tilt its own hiring policies toward the creation of opportunities for ex‐​offenders, even when that means shouldering extra costs or inconvenience, given that incarceration and its after‐​effects are themselves the consequences of government action. But why keep passing laws that backfire even when judged against that goal? And how much less justification is there for using them to constrain the freedom of private employers that have never incarcerated anyone, whether they be government contractors or just plain old businesses?</p> <p>Ban the box laws, above all those that restrict the liberty of private employers, are a&nbsp;triumph of feel‐​good sentiment over economic rationality, practicality, and in the end the interests of the intended beneficiaries.</p> Wed, 22 Jan 2020 14:01:08 -0500 Walter Olson https://www.cato.org/blog/more-evidence-ban-box-laws-dont-work It Violates the First Amendment to Criminalize Immigration Advocacy or Giving Advice to Illegal Immigrants https://www.cato.org/blog/it-violates-first-amendment-criminalize-immigration-advocacy-or-giving-advice-illegal <p><a href="https://www.cato.org/people/ilya-shapiro" hreflang="und">Ilya Shapiro</a> and <a href="https://www.cato.org/people/michael-collins" hreflang="und">Michael Collins</a></p> <p>Regardless of the immigration enforcement practices at any given time, there are people and organizations who urge illegal immigrants to stay in this country and wait for political change. Likewise, immigrants themselves will take proactive steps in an attempt to adjust their status, to come out of the legal shadows.<br><br> Lawyers will advise some immigrants — quite correctly, in many cases — that remaining in the country illegally&nbsp;will grant them certain constitutional or statutory protections that are unavailable outside the United States. But these advocates and attorneys may be tongue‐​tied by a&nbsp;federal law that criminalizes “encourage[ing] … an alien to … reside in the United States, knowing or in reckless disregard of the fact that such … residence is … in violation of law.” The potential sentence for this crime could be increased if the encouragement was motivated by financial gain, such as attorney’s fees or charitable donations.</p> <p>Evelyn Sineneng‐​Smith is an immigration consultant in California who dealt with many unlawfully present aliens in the Filipino community. She took advantage of certain clients by taking their money to apply for a&nbsp;federal program that would normalize their status, while knowing that this program was not open to them. She was prosecuted for and convicted of that fraud; the government had her dead to rights and that’s the end of that story.</p> <p>But the government further alleged that Ms. Sineneng-Smith’s advice influenced her clients to stay in the country illegally. She was thus also charged and convicted for encouraging aliens to remain in the United States unlawfully, the sentence for which was enhanced by a&nbsp;finding that she did so for financial gain. The U.S. Court of Appeals for the Ninth Circuit reversed her conviction, ruling that the statute violated the First Amendment. The Supreme Court agreed to consider the case.</p> <p>Under the First Amendment, Congress cannot criminalize speech. Certain types of speech, however — like threats, obscenity, incitement of violence, and speech integral to criminal conduct — are not protected by the First Amendment. A&nbsp;defendant whose own speech is not protected may nevertheless challenge her conviction on the ground that the law is “overbroad” and sweeps in others’ protected speech.</p> <p>A law is overbroad when the unprotected speech or actions it legitimately targets are eclipsed by the protected speech that could be targeted. In <em>Ashcroft v. Free Speech Coalition</em> (2002), the Supreme Court explained that overbreadth challenges are necessary because severe penalties for violating an unconstitutional law are enough to deter (“chill”) law‐​abiding citizens from speaking, even if they would eventually win a&nbsp;challenge to their convictions.</p> <p>Cato has filed an <a href="https://www.cato.org/publications/legal-briefs/united-states-v-sineneng-smith">amicus brief</a> supporting Ms. Sineneng‐​Smith in the Supreme Court. Our brief counters part of the government’s brief, which argues that, even if the statute is overbroad, it’s saved by the fact that additional elements of financial gain need to be proven for a&nbsp;sentence enhancement. We argue that the sentence enhancement is irrelevant to the chilling effect of the underlying statute and, even if the analysis is limited to encouragement motivated by financial gain, the statute still criminalizes protected commercial speech.</p> <p>The Supreme Court will hear oral argument in <a href="https://www.scotusblog.com/case-files/cases/united-states-v-sineneng-smith/"><em>United States v. Sineneng‐​Smith</em></a>&nbsp;on February 25.</p> Wed, 22 Jan 2020 10:31:11 -0500 Ilya Shapiro, Michael Collins https://www.cato.org/blog/it-violates-first-amendment-criminalize-immigration-advocacy-or-giving-advice-illegal Reduce Your Ignorance of Immigration Policy with This Quiz https://www.cato.org/blog/cure-immigration-ignorance-quiz <p><a href="https://www.cato.org/people/alex-nowrasteh" hreflang="und">Alex Nowrasteh</a></p> <p>Like most public policy issues, immigration is difficult to understand. The issue has complex effects on American society and the world at large. This difficulty doesn’t prevent most people from forming strong opinions on the topic, but unfortunately ignorance guides many of their opinions. And I don’t mean ignorance regarding the findings of peer‐​reviewed literature or what social scientists say about immigration. I mean ignorance of basic facts about immigration, such as their numbers and percentage of the population, leads to systematic incorrect estimates.</p> <p>This ignorance matters a lot. Some <a href="https://scholar.harvard.edu/alesina/publications/immigration-and-redistribution">research</a> has found that people significantly overestimate the number of immigrants, their percent of the population, and how culturally distant they are from themselves. On the individual level, holding incorrect factual opinions on immigration is correlated with being skeptical of the benefits of immigration. To be clear, many well‐​informed people disagree with our policy recommendations. Being more knowledgeable on this topic can only help Americans form better policy opinions — regardless of what those opinions are. That’s something we all should welcome.</p> <p>To reduce your own ignorance or to see how afflicted you are, take this test and see how well you do:</p> <div class="responsive-embed"></div> Tue, 21 Jan 2020 13:58:45 -0500 Alex Nowrasteh https://www.cato.org/blog/cure-immigration-ignorance-quiz Public Schools Cannot Be Religiously Neutral, But School Choice Makes Neutrality Possible https://www.cato.org/blog/supreme-court-must-understand-public-schools-cannot-be-religiously-neutral <p><a href="https://www.cato.org/people/neal-mccluskey" hreflang="und">Neal McCluskey</a></p> <p>Tomorrow the U.S. Supreme Court will hear oral argument in <em><a href="https://www.scotusblog.com/case-files/cases/espinoza-v-montana-department-of-revenue/">Espinoza v. Montana</a></em>, a case addressing state constitutional provisions that bar public funds from going to religious institutions, especially schools. At the crux of the case is the belief that taxpayers should not be forced to take sides on religion. But the oft‐​ignored root problem is that public schools <em>cannot be religiously neutral</em>; no matter what they do they are taking sides on religious matters. Only school choice — what has been quashed in Montana — frees the state from that.</p> <p>The specifics of the case seem minor. The Montana Supreme Court struck down a program offering a $150 tax credit to people who donated to groups furnishing scholarships for students to attend private schools, including religious. As long as religious schools were included, the Montana court ruled that the whole program had to be struck down, lest it violate the state’s <a href="https://leg.mt.gov/bills/mca/title_0000/article_0100/part_0010/section_0060/0000-0100-0010-0060.html">constitutional provision</a>—a so‐​called Blaine amendment — interpreted to prohibit any funds from reaching “sectarian” schools.</p> <p>At the heart of many people’s concern is entangling government with religion, an absolutely legitimate worry. But as long as there is public schooling — which deals inescapably with minds, and hence worldviews — government <em>will be</em> entangled with religion.</p> <p>As I illustrate in this <em><a href="https://www.tandfonline.com/doi/full/10.1080/15582159.2018.1524427">Journal of School Choice<span> </span></a></em><a href="https://www.tandfonline.com/doi/full/10.1080/15582159.2018.1524427"><span>article</span></a>—which is also part of a <a href="https://www.routledge.com/Educating-Believers-Religion-and-School-Choice-1st-Edition/Maranto-Danish-Shakeel/p/book/9780367436650">new book on the nexus of education and religion</a>—public schooling has never been, and <em>can never be</em>, religiously neutral. Reproduced below is a graphic I created for the <em>JSC</em> article to help readers understand the many levels on which public schooling intersects with religion. They run from elevating non‐​religion over religion by the very effort to have religion‐​free education, to teaching religion‐​saturated history.</p> <div data-embed-button="image" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="768029ca-f305-4000-9717-eba91c74539b" class="align-center embedded-entity" data-langcode="en"> <p><img srcset="/sites/cato.org/files/styles/pubs/public/2020-01/wjsc_a_1524427_f0002_b_0.jpeg?itok=ndjaOuhX 1x, /sites/cato.org/files/styles/pubs_2x/public/2020-01/wjsc_a_1524427_f0002_b_0.jpeg?itok=gwJp91_o 1.5x" width="700" height="644" src="https://www.cato.org/sites/cato.org/files/styles/pubs/public/2020-01/wjsc_a_1524427_f0002_b_0.jpeg?itok=ndjaOuhX" alt="Diagram showing levels of religion in schools" typeof="Image" class="component-image" /></p></div> <p>The <a href="https://www.cato.org/education-fight-map">Public Schooling Battle Map</a>—sadly, still in a state of reconstruction — illustrates that religion remains a powerful flashpoint in public schools. The database contains 346 state‐ and district‐​level battles explicitly and foremost about the presence of religion, or perceived affronts to religion, ranging from <a href="https://www.ksat.com/news/local/2019/12/17/somerset-isd-takes-down-biblical-religious-display-after-complaint-from-american-humanist-association/">creationist displays</a> in schools to <a href="https://www.mdjonline.com/news/cobb-county-schools-yoga-case-will-get-jury-trial/article_16e47f5e-4821-11e9-9e03-1f6acd26a322.html">yoga classes</a>. Many other conflicts may implicate religion, though it may not be the core concern, including battles over bathroom and locker room access being contested <a href="https://www.cnn.com/2016/08/23/us/transgender-bathroom-policies/index.html">nationwide</a>.</p> <p>Quite simply, religious neutrality in public schools is impossible.</p> <p>Can government promote education at all without touching on religion? Probably not, but it can come much closer than it does with public schooling. The solution is to do the very thing the Montana Supreme Court struck down: allow people to direct some of their income to groups that provide scholarships, and give them a tax credit. That would enable taxpayers to freely direct their money so that families could choose private schools that may be religious, or to otherwise let it go to public schools. What is crucial is that government no longer force funding of particular schools, and hence particular approaches to faith, rendering the state <em>truly</em> neutral.</p> <p>There are <a href="https://ij.org/press-release/friends-of-the-court-submit-u-s-supreme-court-briefs-to-support-religious-options-in-school-choice-programs/">many reasons</a> the U.S. Supreme Court should rule in favor of school choice. But the most important is that the end that Blaine amendments are supposed to achieve — keeping government out of religion — is far better served by the measure Montana struck down than maintaining a public school monopoly over taxpayer funds.</p> Tue, 21 Jan 2020 11:30:37 -0500 Neal McCluskey https://www.cato.org/blog/supreme-court-must-understand-public-schools-cannot-be-religiously-neutral Taxpayers Eat Another Solar Energy Flop https://www.cato.org/blog/taxpayers-eat-another-solar-energy-flop <p><a href="https://www.cato.org/people/david-boaz" hreflang="und">David Boaz</a></p> <p>Looks like another federally backed solar energy plant has gone bust. Bloomberg News <a href="https://www.bloomberg.com/news/articles/2020-01-06/a-1-billion-solar-plant-was-obsolete-before-it-ever-went-online">reports</a>, “A $1 Billion Solar Plant Was Obsolete Before It Ever Went Online.”</p> <blockquote><p>In 2011 the $1 billion [Crescent Dunes] project was to be the biggest solar plant of its kind, and it looked like the future of renewable power. <a href="https://www.bloomberg.com/quote/C:US">Citigroup Inc.</a> and other financiers invested $140 million with its developer, <a href="https://www.bloomberg.com/quote/7770949Z:US">SolarReserve Inc.</a> Steven Chu, the U.S. Department of Energy secretary at the time, offered the company [$737 million in] government loan guarantees, and Harry Reid, then the Senate majority leader and senior senator from Nevada, cleared the way for the company to build on public land.</p> </blockquote> <p>The state of Nevada <a href="https://www.wsj.com/articles/the-best-laid-energy-plans-11579219416">chipped in</a> another $119.3 million tax abatements over 20&nbsp;years. But, Chris Martin and Nic Querolo write at Bloomberg,</p> <blockquote><p>By the time the plant opened in 2015, the increased efficiency of cheap solar panels had already surpassed its technology, and today it’s obsolete — the latest panels can pump out power at a&nbsp;fraction of the cost for decades with just an occasional hosing‐​down.…</p> <p>The plant’s technology was designed to generate enough power night and day to supply a&nbsp;city the size of nearby Sparks, Nev. (population 100,000), but it never came close. Its power cost NV about $135 per megawatt‐​hour, compared with less than $30 per MWh today at a&nbsp;new Nevada photovoltaic solar farm, according to BloombergNEF, which researches fossil fuel alternatives.</p> </blockquote> <p>It all reminds me of another giant taxpayer‐​funded failure of the Obama administration’s green‐​energy enthusiasm, Solyndra. Visiting the Solyndra solar‐​panel factory in Fremont, California, in May 2010, President Obama declared, “The true engine of economic growth will always be companies like Solyndra.” But despite $535 million in federal loan guarantees, <a href="https://americanconsequences.com/how-government-saps-our-energy/">Solyndra declared bankruptcy</a> 16 months later.</p> <p>Plenty of people in and around the Obama administration genuinely believed that fossil fuels were dangerous and unsustainable. But as I&nbsp;<a href="https://americanconsequences.com/how-government-saps-our-energy/">wrote</a> in 2018&nbsp;in American Consequences magazine,</p> <blockquote><p><span>when governments pick winners, politics usually rears its ugly head. Official investigations and reporters dug into the story and found that, as the <em>Washington Post</em> <a href="https://www.washingtonpost.com/solyndra-politics-infused-obama-energy-programs/2011/12/14/gIQA4HllHP_story.html"><span>reported</span></a>, “Obama’s green‐​technology program was <a href="https://www.washingtonpost.com/politics/obamas-focus-on-visiting-clean-tech-companies-raises-questions/2011/06/24/AGSFu9kH_story.html"><span>infused with politics</span></a> at every level… Political considerations were raised repeatedly by company investors, Department of Energy bureaucrats and White House officials.”</span></p> <p><span><span><span><span><span><span><span><span><span>The family funds of Oklahoma billionaire George Kaiser, a&nbsp;big Obama fundraiser, owned a&nbsp;third of Solyndra. As the company was failing, Kaiser wrote to a&nbsp;Solyndra board member, “Why don’t you pursue your contacts with the WH?” Two months later the board member wrote Kaiser, “The DOE really thinks politically before it thinks economically.” Solyndra’s lobbyists met at least three times with an aide to top White House official Valerie Jarrett.</span></span></span></span></span></span></span></span></span></p> </blockquote> <p><span><span><span><span><span><span><span><span><span>Government subsidies can bring any business into existence. But apparently even subsidies can’t ensure the production of something useful.</span></span></span></span></span></span></span></span></span></p> Tue, 21 Jan 2020 09:31:06 -0500 David Boaz https://www.cato.org/blog/taxpayers-eat-another-solar-energy-flop Sir Paul Tucker on Floors and Corridors https://www.cato.org/blog/sir-paul-tucker-floors-corridors <p><a href="https://www.cato.org/people/george-selgin" hreflang="und">George Selgin</a></p> <p>In some previous posts, I've taken Federal Reserve officials,<span> </span><a href="https://www.alt-m.org/2020/01/10/the-feds-new-foreign-repo-pool-policy/" rel="noopener noreferrer" target="_blank">including former New York Fed President William Dudley</a>, to task for continuing to insist that the Fed's post-2008 "floor" operating system is a "simple" means for keeping overnight interest rates on target. Whatever the floor system's merits may be, simplicity isn't one of them.</p> <p>But in weighing the advantages of the Fed's floor system compared to those of a "corridor system," Fed officials haven't just put their thumbs on the floor-system scale by exaggerating its merits. They've also exaggerated the drawbacks of a corridor system. In particular, they've framed the choice as one between the current floor system (or rather an idealized version of it), and a revival of the Fed's pre-2008 arrangement, with zero interest on reserves, a relatively wide (but variable) corridor, and heavy reliance upon open-market operations.</p> <p>In fact, none of the "pro-corridor" economists I know —and there are more than a few of us—favors a return to the pre-2008 set-up, or anything like it. Instead, we mostly have in mind a symmetrical corridor, with the (usually though not always positive) interest rate on reserves as its lower limit, and the rate charged by some Fed lending facility—it could be<span> </span><a href="https://www.alt-m.org/2019/05/02/the-feds-new-repo-plan/" rel="noopener noreferrer" target="_blank">the proposed standing repo facility</a>—as its upper limit. Finally, most of us would argue for a relatively narrow corridor of 50 basis points or so, with its correspondingly limited role for open-market purchases and sales.</p> <p>I had intended to elaborate upon this point. But thanks to Sir Paul Tucker, a former Bank of England Deputy Governor and author of<span> </span><a href="https://www.amazon.com/Unelected-Power-Legitimacy-Central-Regulatory-ebook/dp/B07NPFRDLY"><em>Unelected Power: The Quest for Legitimacy in Central Banking and the Regulatory State</em></a>, I don't have to. For Paul argued the same point, very eloquently, at a Hoover Institution conference last year, in commenting on a presentation by Fed Vice Chair Randy Quarles. The conference proceedings, including<span> </span><a href="https://www.hoover.org/sites/default/files/research/docs/cochranepalermotaylor_currencies_ch7.pdf" rel="noopener noreferrer" target="_blank">Quarles' contribution with Paul's comments</a>, are available online, so you can read the whole thing. Still, I can't resist sharing some substantial excerpts, the better to tempt you to read the rest.</p> <p>Paul begins by repeating a central argument of his book, to wit, that central banks should "live by a principle of parsimony in order to aid public comprehensibility and accountability":</p> <blockquote><p>Central banks are very powerful bodies, led by unelected technocrats who are insulated from day-to-day politics. In our democracies, the delegation of government power can be legitimate only if we can track what the legislature’s agents are doing. Central banks should make that as straight-forward as possible. And, in jurisdictions that have chosen to have a market economy, they should distort market mechanisms no more than required to achieve their objectives.</p> <p>This precept entails that central bank balance-sheet operations should at all times be as parsimonious as possible consistent with achieving their objectives. Thus, if price stability can be achieved using only interest rate policy, it should be; and if banking system resilience can be maintained without a permanently enormous central bank balance sheet, it should be.</p> </blockquote> <p>In view of this Paul concludes that, "if there are other options, a floor system violates the principle of parsimony as it involves the central bank choosing to have a larger balance sheet than is necessary for monetary policy."</p> <p>But according to officials at the New York Fed (which is responsible for overseeing monetary operations), a corridor system is no longer a practical option. Their claim, Paul notes, rests upon two propositions. The first holds that, to manage a corridor the Fed would have to be capable of forecasting banks' demand for reserves very accurately. The second asserts that it would have to engage in frequent open market operations.</p> <p>Paul's response, boiled down, is "rubbish."</p> <blockquote><p>Conceptually, neither proposition is true in general. Nor, for what it’s worth, are they true in practice other than in rather particular circumstances.</p> <p>Those circumstances are, broadly, where banks are set a reserves<br /> target; they have to meet it very precisely; the spread between the lending rate and deposit rate is large; and the maintenance period is effectively short (so that there is little or no inter-temporal arbitrage across days). As it happens, nearly all those conditions held in the Fed’s pre-crisis operating system, but they were choices. Having to conduct frequent open market operations and to strive for precision in their forecasts of reserves-demand were consequences of those choices, nothing to do with corridor systems as such.</p> </blockquote> <p>There are, instead (Paul goes on to say), all sorts of corridor systems, "with none having an exclusive right to the label." These differ according to the width of the corridor, whether it is symmetrical or not, the length of the "reserve maintenance period" to which any reserve requirements refer, and various other specifications. (Readers wishing to learn more about the many choices and their pros and cons should start with<span> </span><a href="https://www.kansascityfed.org/~/media/files/publicat/sympos/2016/econsymposium-bindseil-paper2.pdf?la=en" rel="noopener noreferrer" target="_blank">this excellent Ulrich Bindseil article</a>.) It is even possible, Paul notes, to have a corridor system that "does not require any open market operations at all or, indeed, any forecasting of the demand for reserves."</p> <p>What all this means, Paul concludes, is that "when the governors debate the merits of floor versus corridor systems, they do not need to be constrained by the Fed’s rather idiosyncratic pre-crisis system." The Fed is therefore "not condemned …to stick with a giant balance sheet and a 'floor system' for rates forever." Not condemned, that is, so long as those governors will allow themselves to revisit the floor-vs.-corridor question, with all the possible alternatives in mind, and without pretending that the present system has worked according to plan.</p> <p>[<a href="https://www.alt-m.org/2020/01/20/sir-paul-tucker-on-floors-and-corridors/">Cross-posted from Alt-M.org</a>]</p> <p></p> Tue, 21 Jan 2020 09:10:28 -0500 George Selgin https://www.cato.org/blog/sir-paul-tucker-floors-corridors Policymakers Obsess Over Pain Prescribing and Ignore the Giant Elephant in the Room: Prohibition https://www.cato.org/blog/policymakers-obsess-over-pain-prescribing-ignore-giant-elephant-room-prohibition <p><a href="https://www.cato.org/people/jeffrey-singer" hreflang="und">Jeffrey A. Singer</a></p> <p><span><span><span><span><span><span><span><span><span><span><span>On January 20<sup>th</sup>, the <em>Cincinnati Enquirer</em> ran a&nbsp;<a href="https://www.cincinnati.com/story/news/2020/01/19/pain-pill-prescriptions-plummet-hospital-emergency-departments/4452561002/">story</a> on the recent <a href="https://www.cdc.gov/nchs/data/nhsr/nhsr135-508.pdf">report</a> from the Centers for Disease Control and Prevention that showed a&nbsp;30.1 percent drop in prescription opioid volume from 2010 – 2011 to 2016 – 2017. While the CDC report was non‐​judgmental, it was greeted by hospital administrators and emergency physicians in the Cincinnati area as good news.</span></span></span></span></span></span></span></span></span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span>The article quotes one physician/​hospital spokesperson as saying:</span></span></span></span></span></span></span></span></span></span></span></p> <blockquote><p><span><span><span><span><span><span><span><span><span><span><span>“The patient can know, ‘My encounter with the ED will … lead to a&nbsp;good outcome. I&nbsp;will not be exposed to unnecessary threats … downstream.’</span></span></span></span></span></span></span></span></span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span>“They will treat the pain in a&nbsp;safe way.”</span></span></span></span></span></span></span></span></span></span></span></p> </blockquote> <p><span><span><span><span><span><span><span><span><span><span><span>I was interviewed for the story and shared with the reporter my experiences as a&nbsp;general surgeon seeing patients referred from emergency departments in excruciating pain who were given minimal pain medication — sometimes just <em>Tylenol </em>(acetaminophen) or ibuprofen — for conditions needing urgent surgical intervention. I&nbsp;told reporter Terry DeMio “It means a&nbsp;lot of people are getting under‐​treated for pain.”</span></span></span></span></span></span></span></span></span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span>Policymakers, including those in hospital and health care administration, refuse to accept the federal government data showing <a href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6369835/">no correlation</a> between prescription volume and the non‐​medical use of opioids or opioid use disorder among persons aged 12 and over. They <a href="https://www.cato.org/blog/more-evidence-pours-cold-water-false-narrative-prescriptions-caused-opioid-crisis">ignore</a> the 2018 <a href="https://www.bmj.com/content/360/bmj.j5790">study</a> of more than 568,000 “opioid‐​naïve” acute pain patients given opioids from 2008 – 2016 that showed a&nbsp;total <em>misuse </em>rate of 0.6 percent, or last November’s study in the <em><a href="https://www.annemergmed.com/article/S0196-0644(19)31134-5/fulltext">Annals of Emergency Medicine</a></em> that followed “opioid naïve” patients prescribed opioids for acute pain in the emergency department at Albert Einstein College of Medicine and found just one percent still using prescription opioids six months later — and 80 percent of those patients still required the opioids for pain management. </span></span></span></span></span></span></span></span></span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span>Meanwhile, for the past several years, the overwhelming majority of overdose deaths are due to fentanyl and heroin, and a&nbsp;recent study in <em><a href="https://www.cato.org/blog/more-research-shows-its-not-prescriptions-its-prohibition">Public Health Reports</a> </em>found “prescribed opioids were commonly not detected in toxicology reports” of drug overdose decedents. </span></span></span></span></span></span></span></span></span></span></span></p> <p><span><span><span><span><span><span><span><span><span><span><span>It is also important to mention that drugs such as acetaminophen and ibuprofen are not without risk. Acetaminophen can cause <a href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4913076/">liver damage</a>, for example, and ibuprofen can cause <a href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4034033/">kidney</a> damage and gastrointestinal </span></span></span></span></span></span></span></span></span></span></span>bleeding — unlike prescription opioids.</p> <p><span><span><span><span><span><span><span><span><span><span><span>As I&nbsp;mentioned in a&nbsp;<a href="https://www.cato.org/blog/its-easier-criticize-pain-patients-criticize-drug-prohibition">letter to the editor</a> of the <em>Washington Post</em> last December, it is easier for policymakers to focus on the number of pain prescriptions given to patients in pain than to confront the real elephant in the room: the overdose crisis is the result of <a href="https://dailycaller.com/2018/12/04/drug-prohibition-opioid/">drug prohibition</a>. </span></span></span></span></span></span></span></span></span></span></span></p> Mon, 20 Jan 2020 11:57:50 -0500 Jeffrey A. Singer https://www.cato.org/blog/policymakers-obsess-over-pain-prescribing-ignore-giant-elephant-room-prohibition As Supreme Court Considers Several Qualified Immunity Cases, A New Ally Joins The Fight https://www.cato.org/blog/supreme-court-considers-several-qualified-immunity-cases-new-ally-joins-fight <p><a href="https://www.cato.org/people/jay-schweikert" hreflang="und">Jay Schweikert</a> and <a href="https://www.cato.org/people/clark-neily" hreflang="und">Clark Neily</a></p> <p>The Wall Street Journal recently published an <a href="https://www.wsj.com/articles/tear-gas-grenades-and-qualified-immunity-11579133525">op‐​ed</a> by Institute for Justice Senior Attorney Robert McNamara, in which he describes IJ’s <a href="https://ij.org/issues/private-property/project-on-immunity-and-accountability/">decision to join the raging battle against qualified immunity</a>, a&nbsp;court‐​confected doctrine that provides rights‐​violating police and other government officials with what Cato has described as an “<a href="https://www.unlawfulshield.com/frequently-asked-questions-about-qualified-immunity/">unlawful shield</a>” against accountability for their misconduct. IJ’s focus on this issue will be a&nbsp;welcome addition to a&nbsp;fight that Cato has been waging for nearly two years with help from an astonishingly cross‐​ideological cast of public interest organizations ranging from the ACLU and the NAACP Legal Defense Fund to the Alliance Defending Freedom and the Second Amendment Foundation.</p> <p>Cato launched its strategic campaign to challenge the doctrine of <a href="https://www.unlawfulshield.com/frequently-asked-questions-about-qualified-immunity/">qualified immunity</a>—an atextual, ahistorical doctrine invented by the Supreme Court in the 1960s — on March 1, 2018. Cato’s <a href="https://www.cato.org/events/qualified-immunity-supreme-courts-unlawful-assault-civil-rights-police-accountability">kick‐​off panel</a> featured Judge Lynn Adelman of the Eastern District of Wisconsin, who has <a href="https://www.dissentmagazine.org/article/supreme-court-assault-civil-rights-section-1983">sharply criticized the doctrine</a>; Professor Will Baude, whose enormously influential <a href="http://www.californialawreview.org/print/2-is-qualified-immunity-unlawful/">law review article</a> has formed the backbone of the legal challenge to qualified immunity; and Andy Pincus and Victor Glasberg, two practitioners with ample experience confronting the harsh realities of the doctrine. Shortly after that conference, <a href="https://www.cato.org/multimedia/media-highlights-tv/george-will-mentions-cato-institute-leading-fight-against-qualified">George Will</a> noted on Meet the Press that there would be a “national discussion” about qualified immunity, “led by the Cato Institute.”</p> <p>The centerpiece of Cato’s strategic campaign to take down qualified immunity has been a&nbsp;series of targeted <em>amicus</em> briefs urging the Supreme Court to reverse its precedents and eliminate the doctrine outright<em>. </em>Since launching the campaign in March 2018, Cato has filed dozens of additional <em>amicus</em> briefs in our own name, but we have also <a href="https://www.nytimes.com/2018/07/11/nyregion/qualified-immunity-supreme-court.html">organized a&nbsp;massive cross‐​ideological alliance</a> of public interest groups opposed to qualified immunity — what <a href="http://www.ca5.uscourts.gov/opinions/pub/17/17-50518-CV1.pdf">Judge Don Willett recently called</a> “perhaps the most diverse amici ever assembled.” This “cross‐​ideological brief” was first filed in July 2018, in support of the cert petition in <em><a href="https://www.cato.org/blog/leading-scholars-most-diverse-amici-ever-assembled-file-briefs-challenging-qualified-immunity">Allah v. Milling</a></em>, a&nbsp;case involving the illegal and unconstitutional solitary confinement of a&nbsp;pretrial detainee in Connecticut for nearly seven months. So unsettled was the state by the onslaught of <em>amicus</em> support that it settled the case by offering the plaintiff more to dismiss his cert petition than he had been awarded at trial.</p> <p>A diverse array of lower court judges has also been increasingly critical of qualified immunity, with many explicitly calling for the Supreme Court to reconsider the doctrine. To underscore the incredible ideological breadth of the opposition to qualified immunity, it is worth noting that the judicial critics of the doctrine now include nominees of every single President since Carter, as well as one of the two remaining LBJ appointees on the bench. To give just a&nbsp;few notable examples:</p> <ul> <li><a href="http://www.ca5.uscourts.gov/opinions/pub/17/17-50518-CV1.pdf">Judge Don Willett</a>, a&nbsp;Trump appointee to the Fifth Circuit, has explained how “[t]o some observers, qualified immunity smacks of unqualified impunity, letting public officials duck consequences for bad behavior — no matter how palpably unreasonable — as long as they were the <em>first</em> to behave badly,” and sharply notes that “this entrenched, judge‐​created doctrine excuses constitutional violations by limiting the statute Congress passed to redress constitutional violations.”</li> </ul> <ul> <li><a href="https://www.leagle.com/decision/infdco20180831d08">Judge James Browning</a>, a&nbsp;George W. Bush appointee to the District of New Mexico, has now issued several opinions that include a&nbsp;blistering criticism of the Supreme Court’s “clearly established law” standard, and citing Cato’s <em>amicus</em> briefs for the argument that “qualified immunity has increasingly diverged from the statutory and historical framework on which it is supposed to be based.”</li> </ul> <ul> <li><a href="https://casetext.com/case/ventura-v-rutledge">Judge Dale Drozd</a>, an Obama appointee to the Eastern District of California, cited Cato’s March 2018 forum in his discussion of the campaign to challenge qualified immunity, and announced that “this judge joins with those who have endorsed a&nbsp;complete re‐​examination of the doctrine which, as it is currently applied, mandates illogical, unjust, and puzzling results in many cases.”</li> </ul> <p>Now, almost two years into Cato’s campaign, the Supreme Court finally appears to be preparing to confront the question of whether qualified immunity should be reconsidered. There are currently <em>six</em> major qualified immunity cert petitions pending before the Court, and the manner in which the Supreme Court has repeatedly rescheduled consideration of these cases strongly suggests that the Justices may be preparing to consider them together — which in turn suggests that they’re looking closely at the fundamental question of whether qualified immunity should be reconsidered. <a href="https://www.cato.org/blog/supreme-court-may-be-preparing-consider-several-major-cases-qualified-immunity">We first discussed this possibility</a> back in October of last year, and we now have even more evidence suggesting the Court may be preparing to take up this issue. Here are the key details about each of the six cases:</p> <ul> <li><em><strong><a href="https://www.supremecourt.gov/search.aspx?filename=/docket/docketfiles/html/public/18-1287.html">Baxter v. Bracey</a>.</strong> </em>This is the case where the <a href="https://www.opn.ca6.uscourts.gov/opinions.pdf/18a0566n-06.pdf">Sixth Circuit</a> granted qualified immunity to two officers who deployed a&nbsp;police dog against a&nbsp;suspect who had already surrendered and was sitting on the ground with his hands up. The ACLU filed a&nbsp;<a href="https://www.supremecourt.gov/DocketPDF/18/18-1287/95661/20190408145246695_Baxter%20v%20Bracey%20Petition%20for%20Writ%20of%20Certiorary.pdf">cert petition</a> back in April 2019, asking whether “the judge‐​made doctrine of qualified immunity” should “be narrowed or abolished.” <a href="https://www.supremecourt.gov/DocketPDF/18/18-1287/101473/20190530161957223_Baxter%20v.%20Bracey%20Cato%20amicus%20brief.pdf">Cato filed a&nbsp;brief</a> in support of the petition, and we also helped to coordinate the filing of an updated <a href="https://www.supremecourt.gov/DocketPDF/18/18-1287/101646/20190531162059735_FINAL%20Crossideological%20Brief%20Baxter%205.31.2019.pdf">cross‐​ideological brief</a>. Jay Schweikert and Emma Andersson (one of the ACLU attorneys on the case) wrote a&nbsp;<a href="https://takecareblog.com/blog/violation-eludes-vindication-left/right-alliance-urges-supreme-court-to-reform-police-immunity">joint op‐​ed</a> discussing the case back in July, and Law360 ran a&nbsp;detailed story on <em>Baxter</em>, asking “<a href="https://www.law360.com/articles/1202942">Could A&nbsp;Dog Bite Bring An End To Qualified Immunity</a>?”</li> </ul> <ul> <li><strong><a href="https://www.supremecourt.gov/search.aspx?filename=/docket/docketfiles/html/public/18-913.html"><em>Brennan v. Dawson</em></a>. </strong>In this case, the <a href="https://www.opn.ca6.uscourts.gov/opinions.pdf/18a0508n-06.pdf">Sixth Circuit</a> granted immunity to a&nbsp;police officer who, in an attempt to administer an alcohol breath test to a&nbsp;man on misdemeanor probation, parked his car in front of the man’s home at 8:00pm; turned the lights and sirens on for over an hour; circled the man’s house five to ten times, peering into and knocking on windows; and wrapped the home’s security camera in police tape. The court held that this warrantless invasion of the curtilage violated the Fourth Amendment, but nevertheless granted immunity due to a&nbsp;lack of “clearly established law.” The <a href="https://www.supremecourt.gov/DocketPDF/18/18-913/80215/20190111120052778_Filed%20Petition.pdf">cert petition</a> in this case was filed on January 11, 2019, and asks the Court to “reign in the qualified immunity standard to … reflect the common‐​law roots of qualified immunity.”</li> </ul> <ul> <li><a href="https://www.supremecourt.gov/search.aspx?filename=/docket/docketfiles/html/public/19-676.html"><em><strong>Zadeh v. Robinson</strong></em></a> and <a href="https://www.supremecourt.gov/search.aspx?filename=/docket/docketfiles/html/public/19-679.html"><em><strong>Corbitt v. Vickers</strong></em></a>. We’ve <a href="https://www.cato.org/blog/supreme-court-may-be-preparing-consider-several-major-cases-qualified-immunity">discussed these cases</a> in more detail previously, but <em>Zadeh</em> is the case where the <a href="http://www.ca5.uscourts.gov/opinions/pub/17/17-50518-CV1.pdf">Fifth Circuit</a> granted immunity to state investigators that entered a&nbsp;doctor’s office and, without notice and without a&nbsp;warrant, demanded to rifle through the medical records of 16 patients. And <em>Corbitt</em> is the case where the <a href="http://media.ca11.uscourts.gov/opinions/pub/files/201715566.pdf">Eleventh Circuit</a> granted immunity to a&nbsp;deputy sheriff who shot a&nbsp;ten‐​year‐​old child lying on the ground, while repeatedly attempting to shoot a&nbsp;pet dog that wasn’t posing any threat. The plaintiffs in both cases are now represented by Paul Hughes, who filed <a href="https://www.supremecourt.gov/DocketPDF/19/19-676/123464/20191122163707356_Zadeh.cert.pet.pdf">cert</a> <a href="https://www.supremecourt.gov/DocketPDF/19/19-679/123466/20191122164334779_Corbitt.cert.pet.pdf">petitions</a> on November 22, 2019, each of which asks “[w]hether the Court should recalibrate or reverse the doctrine of qualified immunity.” Cato submitted briefs in <a href="https://www.supremecourt.gov/DocketPDF/19/19-676/126407/20191220141759139_Zadeh%20v.%20Robinson%20crossideological%20brief.pdf">both</a> <a href="https://www.supremecourt.gov/DocketPDF/19/19-679/126410/20191220142234327_Corbitt%20v.%20Vickers%20crossideological%20brief.pdf">cases</a>, this time taking the lead on the cross‐​ideological brief, whose signatories also included the Alliance Defending Freedom, the American Association for Justice, the ACLU, Americans for Prosperity, the Due Process Institute, the Law Enforcement Action Partnership, the MacArthur Justice Center, the NAACP, Public Justice, R&nbsp;Street, and the Second Amendment Foundation.</li> </ul> <ul> <li><em><strong><a href="https://www.supremecourt.gov/search.aspx?filename=/docket/docketfiles/html/public/19-682.html">Kelsay v. Ernst</a>.</strong> </em>This is the case where the <a href="https://cases.justia.com/federal/appellate-courts/ca8/17-2181/17-2181-2019-08-13.pdf?ts=1565710223">Eighth Circuit</a>, in an 8 – 4&nbsp;en banc decision, granted immunity to a&nbsp;police officer who grabbed a&nbsp;small woman in a&nbsp;bear hug and slammed her to ground, breaking her collarbone and knocking her unconscious, all because she walked away from him after he told her to “get back here.” The <a href="https://www.supremecourt.gov/DocketPDF/19/19-682/123715/20191126132451862_19-__%20PetitionForAWritOfCertiorari.pdf">cert petition</a> in this case was filed on November 26, 2019, and while it doesn’t ask the Court to reconsider qualified immunity outright, it does ask the Court to “take steps within the confines of current law to rein in the most extreme departures from the original meaning of Section 1983.” <a href="https://www.supremecourt.gov/DocketPDF/19/19-682/126531/20191223123129162_Kelsay%20v.%20Ernst%20Cato%20amicus%20brief.pdf">Cato filed a&nbsp;brief</a> in support of this petition as well.</li> </ul> <ul> <li><em><strong>West v. Winfield.</strong> </em>As related in the IJ op‐​ed mentioned above, police officers told Shaniz West that they were looking for her ex‐​boyfriend and thought he might be inside her house, so she gave them permission to go in and look. But instead of entering, they instead called a&nbsp;SWAT team, who bombarded it from the outside with tear‐​gas grenades, effectively destroying her home and all her possessions (the ex‐​boyfriend wasn’t even inside). The <a href="http://cdn.ca9.uscourts.gov/datastore/opinions/2019/07/25/18-35300.pdf">Ninth Circuit</a> granted immunity to the officers, on the grounds that no prior case specifically established that this sort of bombardment exceeded the scope of consent that Ms. West gave to allow officers to enter her home. Yesterday, the IJ filed a&nbsp;<a href="https://ij.org/wp-content/uploads/2020/01/39265-pdf-McNamara-br.pdf">cert petition</a> on behalf of Ms. West asking the Court to clarify and limit the scope of qualified immunity. As noted, this case marks the launch of IJ’s “<a href="https://ij.org/issues/private-property/project-on-immunity-and-accountability/">Project on Immunity and Accountability</a>,” which is focused on challenging doctrines like qualified immunity that erroneously permit public officials to operate above the law. IJ has previously joined various iterations of the Cato‐​conceived cross‐​ideological brief described above, but we’re looking forward to filing our own amicus brief in support of IJ’s cert petition in <em>West</em>.</li> </ul> <p>The Court has yet to make a&nbsp;final decision about any of these cert petitions, but there’s good reason to think the Justices are preparing to consider at least some of them jointly. First, in every single one of these cases (except <em>West</em>, as it was just filed yesterday), the Court has “called for a&nbsp;response” to the cert petition. Although a&nbsp;CFR alone is no guarantee of a&nbsp;cert grant, it’s an <a href="https://media2.mofo.com/documents/180726-call-for-response-scotus-interest.pdf">encouraging sign</a> that at least some of the Justices are looking closely at the case, and want to hear more from the respondents about the issue.</p> <p>Second, the Court’s repeated rescheduling decisions strongly suggest that they’re planning to consider them together, meaning they’re likely to address the fundamental, underlying question of whether qualified immunity itself should be reconsidered. Specifically, <em>Baxter</em> and <em>Brennan</em> were both fully briefed and originally set to be considered in October 2019. But since then, the <em>Baxter</em> petition has been rescheduled five times, and <em>Brennan</em> has been rescheduled three times, most recently on January 8th in both cases. January 8th also happens to be the same day in which the Court called for a&nbsp;response in both <em>Zadeh</em> and <em>Corbitt</em> (with the <em>Kelsay</em> CFR following five days later, on January 13th). It’s hard to imagine why else the Court would postpone these fully briefed petitions for over three months, unless they were holding them to consider along with these more recent petitions raising the same ultimate question.</p> <p>Of course, this is all still speculative to some degree, and even if the Court does grant cert in one or more of these cases, there’s a&nbsp;wide range of potential outcomes. But the confluence of so many powerful petitions pending at the same time, combined with the Court’s obvious focus on this issue, makes undeniable what Cato has been saying for years — one way or another, the Supreme Court is going to have to confront the glaring legal inadequacies of qualified immunity, together with the massive injustices the doctrine has perpetrated on countless individuals whose rights have been violated with impunity by unaccountable police and other government officials.</p> Fri, 17 Jan 2020 17:00:34 -0500 Jay Schweikert, Clark Neily https://www.cato.org/blog/supreme-court-considers-several-qualified-immunity-cases-new-ally-joins-fight On “Imminence”: Absence of Evidence is Evidence of Absence https://www.cato.org/blog/imminence-absence-evidence-evidence-absence <p><a href="https://www.cato.org/people/gene-healy" hreflang="und">Gene Healy</a></p> <p>“We caught him in the act and terminated him,” President Trump <a href="https://www.nbcnews.com/politics/donald-trump/trump-soleimani-strike-his-reign-terror-over-n1110226">said</a> in his first public comments about the January 3<sup>rd</sup> targeted killing of Iranian General Qassim Suleimani. The strike was ordered to avert “imminent and sinister attacks on American diplomats and military personnel.” Over the last two weeks, the Trump administration has offered a farrago of <a href="https://www.nytimes.com/2020/01/12/us/politics/trump-suleimani-explanations.html?smid=nytcore-ios-share">conflicting accounts</a>—and zero evidence for that claim. In this case — apologies to <a href="https://opinionator.blogs.nytimes.com/2014/03/28/the-certainty-of-donald-rumsfeld-part-4/">Don Rumsfeld</a>—absence of evidence is evidence that imminence was absent. And, unless you believe the Constitution gave the president practically unbridled discretion to embroil us in war, that means legal authority for the move was absent too.</p> <p>The Pentagon’s initial <a href="https://www.defense.gov/Newsroom/Releases/Release/Article/2049534/statement-by-the-department-of-defense/">announcement</a> made no claim of exigent circumstances: “this strike was aimed at deterring future Iranian attack plans.” Hours later, however, Secretary of State Mike Pompeo <a href="https://thehill.com/policy/defense/476621-pompeo-soleimani-killed-due-to-imminent-threats-to-american-lives">claimed</a> the president acted “in response to imminent threats to American lives” — “dozens if not hundreds” of them. Since then, when asked to elaborate, Pompeo has served up (1) a <a href="https://www.nbcnews.com/meet-the-press/meet-press-january-5-2020-n1110181">word‐​salad</a> about “situational awareness of risk and analysis”; (2) a backward‐​looking theory by which past attacks demonstrate <a href="https://twitter.com/atrupar/status/1214567253015965696?s=20">the imminence</a> of future ones; and (3) the defensive insistence that “it was real,” even if “we don’t know precisely when and we don’t know precisely where” — also, don’t give me that look: “those are completely <a href="https://www.politico.com/news/2020/01/10/pompeo-spars-with-reporters-over-imminent-soleimani-threat-097175">consistent thoughts</a>”! He may yet crack under questioning.</p> <figure role="group" class="align-right filter-caption"><div data-embed-button="image" data-entity-embed-display="view_mode:media.blog_post" data-entity-type="media" data-entity-uuid="3570a66d-f681-4389-9a26-9783c21d45df" data-langcode="en" class="embedded-entity"> <p><img srcset="/sites/cato.org/files/styles/pubs/public/2020-01/HurricaneMap.jpeg?itok=y5VRsnc0 1x, /sites/cato.org/files/styles/pubs_2x/public/2020-01/HurricaneMap.jpeg?itok=Luv6hSCk 1.5x" width="700" height="510" src="https://www.cato.org/sites/cato.org/files/styles/pubs/public/2020-01/HurricaneMap.jpeg?itok=y5VRsnc0" alt="Don't be so cynical!" typeof="Image" class="component-image" /></p></div> <figcaption><div class="figure-caption text-sans-alternate">Would I lie to you about an “imminent threat”? </div> </figcaption></figure><p>“We did it because they were looking to blow up our embassy,” President Trump <a href="https://www.cnn.com/2020/01/09/politics/trump-soleimani-us-embassy/index.html">said</a> last Thursday; wait, make that embass<em>ies</em>, plural, <a href="https://www.foxnews.com/politics/trump-tells-laura-ingraham-four-embassies-were-targeted-in-imminent-threat-from-iran">four of them</a>, he told Fox’s Laura Ingraham on Friday. Given the administration’s well‐​known preference for keeping Congress in the dark, maybe it’s not surprising <a href="https://www.washingtonpost.com/national-security/trump-now-claims-four-embassies-were-under-threat-from-iran-raising-fresh-questions-about-intelligence-reports/2020/01/10/02f8d154-33e7-11ea-a053-dc6d944ba776_story.html">nobody mentioned</a> the alleged embassy threat in the post‐​hoc, closed‐​door Hill briefing last week. But surely it’s a little odd that Trump’s <a href="https://www.nytimes.com/2020/01/12/us/politics/esper-iran-trump-embassies.html">own secretary of defense</a> didn’t get the intel memo.</p> <p>There’s a simple explanation for the Trump Team’s shifting explanations: they’re lying. Leave aside the dubious notion that it’s possible to stop an imminent attack by killing a senior military commander (were the plans just in his head?) — apparently, the president conditionally authorized the Soleimani killing some <a href="https://www.nbcnews.com/politics/national-security/trump-authorized-soleimani-s-killing-7-months-ago-conditions-n1113271">seven months ago</a>. (According to NBC News, Pompeo and then‐​national security adviser John Bolton even urged Trump to greenlight the hit last June, in response to the Iranians plinking a US drone.) The news that the day of the strike, U.S. forces tried and failed to take out another <a href="https://www.washingtonpost.com/opinions/2020/01/10/new-iran-revelations-suggest-trumps-deceptions-were-deeper-than-we-thought/">top Quds Force commander</a> in Yemen further undermines the administration’s story that their aim was to avert an imminent threat.</p> <p>Don’t worry about it, the president said Monday: whether “the future [Iranian] attack” (we’re back to just one, now?) was imminent or not “<a href="https://twitter.com/realdonaldtrump/status/1216754098382524422">doesn’t really matter</a> because of [Soleimani’s] horrible past.” “Imminence is something of a red herring,” Attorney General Bill Barr echoed <a href="https://www.usatoday.com/story/news/politics/2020/01/14/trump-administration-justifications-soleimani-killing/4463875002/">later that day</a>: the strike was a “legitimate act of self‐​defense,” and, legally, not even “a close call.”</p> <p>It’s not surprising that the attorney general holds that view. Barr embraced a maximalist theory of presidential war powers long before he became Trump’s <a href="https://books.google.com/books/about/The_Mueller_Report.html?id=viyVDwAAQBAJ">Bobby Kennedy</a>. In the run‐​up to the 1991 Gulf War, Barr, then serving as deputy attorney general, advised President George H.W. Bush that he could <a href="https://www.lawfareblog.com/bill-barr-war-powers-insights-his-2001-oral-history-interview">launch a land war</a> involving some half a million U.S. troops without authorization from Congress.</p> <p>But, unless you’re willing to go <a href="https://www.cato.org/blog/declare-kinetic-military-action">full John Yoo</a> and endorse <a href="https://www.latimes.com/archives/la-xpm-2005-dec-20-oe-yoo20-story.html">“the president’s right to start wars,”</a> imminence matters because the constitutional claim has to be based on self‐​defense. Under Article II, the president retains some measure of defensive power, alternately <a href="http://press-pubs.uchicago.edu/founders/documents/a1_8_11s4.html">described</a> at the Convention as the power “to repel sudden attacks” or “to repel and not to commence war.” That power reasonably includes the use of force to avert an impending attack not yet begun. But as you move from shooting back, to addressing an immediate threat, to “deterring future Iranian attack plans” — or <a href="https://www.reuters.com/article/us-iraq-security-pompeo-soleimani/pompeo-says-soleimani-killing-part-of-new-strategy-to-deter-us-foes-idUSKBN1ZC2I3">“re‐​establishing deterrence,”</a> as Pompeo put it this week — the self‐​defense rationale disappears. If the Trump administration wants the general power to target Iranian military commanders as enemy combatants, it should make its case for war to Congress.</p> <p>On the Cato blog last Wednesday, <a href="https://www.cato.org/blog/trump-decider">I posed a hypothetical</a> to test how far the Trump administration’s “defensive” war powers theory might extend: “‘Supreme Leader’ Ayatollah Ali Khamenei sits atop the military chain of command and apparently <a href="https://www.nytimes.com/2020/01/04/us/politics/trump-suleimani.html">had to approve</a> the recent militia attacks. Does Article II empower Trump to order a hit on the Ayatollah?”</p> <p>Later that day, Sen. Mike Lee (R‑UT) came out of the congressional briefing with Trump national security officials as <a href="https://www.politico.com/news/2020/01/09/pence-mike-lee-iran-briefing-096652">angry</a> as anyone’s ever seen him. It turns out, one of Lee’s colleagues asked that very question — and the administration <a href="https://twitter.com/mtracey/status/1215299295232040960?s=21">refused to answer.</a></p> <p>Lee — the founder of the <a href="https://www.lee.senate.gov/public/index.cfm/article-one-project">“Article I Project,”</a> aimed at reclaiming Congress’s constitutional powers — was right to be livid. Assassinating a senior regime figure to “re‐​establish deterrence” isn’t repelling a sudden attack — it’s an <a href="https://scholarship.law.cornell.edu/clr/vol93/iss1/10/">effective declaration of war</a>. The power to make that call can’t be found <a href="http://press-pubs.uchicago.edu/founders/tocs/a1_8_11.html">in Article II</a>.</p> Fri, 17 Jan 2020 16:29:01 -0500 Gene Healy https://www.cato.org/blog/imminence-absence-evidence-evidence-absence