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Description: Cato Weekly Video presents a variety of speakers, interviews, and events at the Cato Institute. The wealth of Cato's multimedia content is carefully selected and edited to portray the most pivotal issues in a concise and engaging way, inviting viewers to rethink their assumptions about liberty and the proper role of government.
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Title:Washington's Biggest Strategic Mistake
Date:Fri, 18 Apr 2014 16:45 EDT
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Description:Ted Galen Carpenter The United States is on the brink of committing a cardinal sin in foreign policy: antagonizing two major powers simultaneously. There are frictions in bilateral ties with both Moscow and Beijing that have reached alarming levels over the past year or so. It is a disturbing development that could cause major geopolitical headaches for Washington unless the Obama administration takes prompt corrective measures and sets more coherent priorities. Russia’s invasion and annexation of Crimea has created a deep freeze in relations that were already rather frosty. Although few knowledgeable Americans agreed with Mitt Romney’s assertion in the 2012 presidential campaign that Russia was the principal geopolitical adversary of the United States, there were surging sources of friction even before the onset of the Crimea crisis, including sharp disagreements over policy toward Syria and Iran. The Crimea episode has made matters dramatically worse, with Washington and its European Union allies imposing economic sanctions on Russia, and the Kremlin responding with (mostly symbolic) sanctions of its own. The language coming out of both Washington and Moscow is characterized by a hostility not seen since the end of the Cold War. U.S. officials ruminate about deploying troops to NATO members in Eastern Europe to discourage additional expansionist moves by Russia.Hawks in the U.S. foreign policy community openly advocate an even more provocative troop deployment, along with military aid, to Ukraine. “The United States is on the brink of committing a cardinal sin in foreign policy: antagonizing two major powers simultaneously.” Washington’s relations with Beijing also have become noticeably more contentious. That point was highlighted during Secretary of Defense Chuck Hagel’s recent visit to China. A series of testy exchanges culminated with a pointed warning from Defense Minister Chang Wanquan that efforts to “contain” China would never succeed. Beijing has been increasingly irritated by U.S. stances on a variety of issues. Washington’s position regarding China’s territorial disputes with neighboring states in both the South China and East China seas is an especially prominent grievance. From Beijing’s perspective, the Obama administration has exhibited an unsubtle backing of Japan, the Philippines, Vietnam, and other rival claimants. The new security agreement between Washington and Manila is likely to further exacerbate Sino-U.S. tensions on territorial issues. The simultaneous deterioration of U.S. relations with Russia and China is more than a little worrisome. It violates an important admonition that Secretary of State Henry Kissinger made during the Cold War. Reflecting on the Nixon administration’s decision to normalize relations with China, Kissinger emphasized the underlying geostrategic rationale. “Our relations to possible opponents,” he wrote in White House Years, the first volume of his memoirs, “should be such that our options toward both of them were always greater than their options toward each other.” In other words, he believed that Washington should take steps to make certain that its ties to both Beijing and Moscow were always closer than their ties to each other. It was a good strategy then, and it is a good strategy now. Clumsy diplomacy by the Obama administration threatens to produce a different and much more unpleasant result. Washington’s conduct may even be pushing Russia and China together, causing them to mute their own serious differences—including border disputes going back into the nineteenth century and ongoing political and economic competition in Central Asia—to deal with more pressing worries about the United States. Even the tone of U.S. diplomacy toward both countries is sometimes needlessly shrill and confrontational. Obama administration officials have thrown diplomatic temper tantrums because Beijing and Moscow have dared to resist U.S.-led efforts to unseat Syrian leader Bashar al-Assad and impose increasingly harsh economic sanctions on Iran. National Security Adviser Susan Rice, at the time U.S. ambassador to the United Nations, denounced Chinese and Russian vetoes of a Security Council resolution on Syria, proclaiming that her country was “disgusted” and adding that such actions were “shameful” and “unforgivable.” That attitude unsurprisingly drew sharp rebukes from Moscow and Beijing. Ideally, the United States should seek to repair relations with both countries. If Obama administration officials cannot bring themselves to adopt that approach, they should at least choose one major power to be the designated adversary, not antagonize both governments. The last thing we should want to do is inadvertently help reverse the split between Moscow and Beijing that began in the late 1950s. That means setting policy priorities and making choices. Policy makers need to ask themselves a set of important questions. Which country is more important to the United States, strategically and economically? Which country is more capable of harming important American interests? Which country may have the greater intent and capability to disrupt the status quo in their respective regions? Which country may have the intent and ability to alter the global status quo to the disadvantage of the United States? Those questions do not have easy answers. Russia may seem to be the more worrisome potential adversary in some categories, China in others. But making such complex assessments is the challenge confronting any effective foreign policy. Dodging that task and creating the risk of making adversaries of both Moscow and Beijing, which appears to be the current U.S. approach, is not an intelligent option. Down that path lie frustration and potential disaster. Ted Galen Carpenter, a senior fellow at the Cato Institute and a contributing editor to The National Interest, is the author of nine books and more than 550 articles and policy studies on international affairs.

Title:The Shocking Secret Behind Obamacare Enrollment Numbers
Date:Wed, 16 Apr 2014 14:37 EDT
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Description:Michael F. Cannon Barack Obama wants you to know he enrolled 7.5 million Americans through Obamacare’s health insurance Exchanges. What he doesn’t want you to know is how. Federal courts may soon rule that President Obama induced the majority of those enrollees to enroll by offering them taxpayer dollars he has no legal authority to spend.  If the courts put a stop to that unauthorized spending, a majority of Exchange enrollees would suddenly face the full cost of Obamacare coverage, and enrollments would plummet. “The president is literally forcing taxpayers, without any legal authorization, to subsidize two out of every three Exchange enrollments.” Under the Patient Protection and Affordable Care Act, states have the option of establishing an Exchange themselves, or letting the federal government do it. The Act also authorizes subsidies that can require taxpayers to cover nearly the entire premium for Exchange plans. Among the eligibility criteria for those subsidies is a requirement that recipients enroll “through an Exchange established by the State.” Such requirements are routine, and this one is and unequivocal. Countless federal programs offer subsidies only in states that agree to implement them. The PPACA’s legislative history is littered with Republican and Democratic proposals to offer various subsidies — including tax credits and Exchange subsidies — exclusively in states that establish Exchanges. The eligibility rules for the PPACA’s Exchange subsidies specify nine times, without deviation, that recipients must enroll “through an Exchange established by the State.” House Democrats even complained about this part of the Senate-passed PPACA before they themselves approved it, so they knew exactly what they were sending to the president’s desk. Confounding supporters’ expectations, 34 states declined to establish Exchanges. Under the plain terms of federal law, subsidies are therefore available in the 16 Exchanges established by states, and not available in the 34 Exchanges established by the federal government. In 2011, however, the Obama administration unilaterally announced it would force taxpayers to subsidize insurance purchased through federal Exchanges as well. It cited no statutory authority for its decision, and has stubbornly refused to follow its own law despite immediate and sustained criticism.  In January of this year, the Obama administration began spending billions of dollars of unauthorized subsidies to induce Americans to enroll in the 34 Exchanges established by the federal government. The president is literally forcing taxpayers, without any legal authorization, to subsidize two out of every three Exchange enrollments.  Fortunately, unlike other ways President Obama has unilaterally rewritten the health care law, this one faces credible court challenges. Under the PPACA’s many interrelated provisions, those subsidies trigger penalties against millions of employers and individual taxpayers, who have filed suit asking the courts to put a stop to both. Last month, one of those lawsuits — Halbig v. Sebelius — went before a skeptical three-judge panel of the D.C. Circuit. After years of not articulating any statutory basis for its decision, the administration assured the court that the PPACA “makes clear that Congress expected the federal premium tax credits to be available on the federal exchange.”  How?  Through “a system of nested provisions that when you walk through them lead to the conclusion that the federal Exchange stands in the place of a state exchange.”  Oh. No one disputes the purpose of a federal Exchange is to stand in the place of a state-established Exchange. The problem is the administration’s logical leap that an Exchange established by the federal government is somehow “established by the State.” Judge Thomas B. Griffith, a George W. Bush appointee considered the panel’s swing vote, somewhat comically forced the administration to admit the tautology that an Exchange established by the federal government is not “established by the State.” He then explained, “the key language is who establishes the Exchange, and you just keep coming back to well, the Secretary establishes it.” The D.C. Circuit likely will issue a ruling sometime in the coming months, as will the 4th Circuit, which will hear oral arguments in King v. Sebelius on May 14, another challenge to the legality of the subsidies. Two similar challenges, filed by the attorneys general in Oklahoma (Pruitt v. Sebelius) and Indiana (Indiana v. IRS), await consideration in federal district courts. A ruling for the plaintiffs would uphold part of Obamacare the president is trying to repeal all by himself. And it would expose that the president is inducing millions of Americans to enroll in Obamacare under false pretenses. Michael F. Cannon is director of health policy studies at the Cato Institute. He blogs at

Title:Tax Day
Date:Wed, 16 Apr 2014 14:30 EDT
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Description:Michael D. Tanner Yesterday was, of course, tax day, the day on which most Americans file their federal and state income taxes. This, it should be noted, is different from the day on which Americans finally stop working just to pay taxes, which this year falls on April 18, three days later than last year. Until then, the government collects, on average, every cent that Americans earn, so you may still have a few more days to go until you can keep the fruits of your labor. Altogether, Americans will pay roughly $3 trillion in federal taxes this year, the most ever in nominal dollars. For taxes as a share of GDP, it is topped only by the year 2000. So much for the idea that our budget problems are caused by a lack of revenue. Tax day inevitably brings out a wide variety of pundits and politicians to repeat a number of persistent myths about American taxation, in particular the recycled claims about how the current tax system is rigged against the poor and middle class to benefit the wealthy. “How much, really, do different brackets of wage earners pay?” There certainly is much to criticize about the American tax system. It is far too complex and riddled with special-interest favors. There is definitely something wrong when an estimated 1,000 American households earning more than $1 million were able to avoid paying any income taxes in 2013. Moreover, the time and effort put into tax avoidance is badly distorting to the economy in general. Those who believe in free markets should admit that not every tax break is justifiable. However, on the larger point, wealthy Americans already pay a disproportionate share of federal income taxes. The top 1 percent earns 16 percent of all income in the United States, while paying 36.7 percent of all federal income taxes. The top 5 percent earns just over a third of U.S. income, but pays 59 percent of federal income taxes. On the other hand, the bottom half of tax filers earns 12 percent of U.S. income, but pays just 2.4 percent of federal income taxes. In fact, the 400 highest-earning Americans together pay nearly as much in federal income taxes as do the 50 percent of taxpayers at the low end of the scale. So, yes, the rich earn a lot more than the rest of us — that’s what makes them rich, after all — but they pay even more. True, if you also take into account sales, payroll and corporate income taxes, things even out a bit. But even so, in 2010 the average federal tax rate was only 11.5 percent for the middle quintile, compared to 24 percent for the highest quintile. The much-maligned 1 percent faced an even higher average rate of 29.4 percent. All of this is before the increase in the top tax rates as part of the fiscal-cliff deal and the numerous tax increases embedded in Obamacare take effect; today, the tax system is even more progressive than it was four years ago. And if you consider taxes as a transaction — what people receive from the government vs. what they pay — in 2010 those in the lowest quintile paid, on average, $300 in federal taxes but received $8,600 in transfers from programs like the earned-income tax credit, the Supplemental Nutrition Assistance Program, and the refundable portion of the child tax credit. But this phenomenon was hardly confined to the lowest-income Americans. Indeed, three-fifths of Americans received more in transfers than they paid in federal taxes, with those in the middle quintile receiving $8,400 more than they paid in. As can be seen from the numbers above, the U.S. tax code is quite progressive. But American liberals might be shocked to discover that the United States actually has the most progressive tax system of all the major industrialized democracies. The OECD measured the ratio of percentage of taxes paid to percentage of market income for the top 10 percent of earners in 24 countries. Total market income is far larger than total taxes paid, so even if the ratio is above 1, this is not saying this population pays more in taxes than they earn; it is saying that the share of taxes they pay is greater than the share of income they earn. In this report the U.S. came out on top, with the share of taxes paid equaling 135 percent of the share of income earned, far ahead of such “progressive” countries as France (110 percent), Denmark (102 percent), and Sweden (100 percent). We think of the European countries as having progressive tax systems because they have such high taxes on the rich. But we forget that they have high taxes on everyone else too. In addition, they rely heavily on value-added taxes, which are highly regressive. In 2011, nearly 18 percent of Europe’s tax receipts, on average, came from value-added taxes — as much as 30 percent in Lithuania. Nor should we forget that the United States has a higher corporate tax rate than any of our European rivals. A serious debate about tax reform is long overdue. But any such debate will require a few more facts — and a bit less class warfare. Michael Tanner is a senior fellow at the Cato Institute and the author of Leviathan on the Right: How Big-Government Conservatism Brought Down the Republican Revolution.

Title:Fed Can Print Money, But It Can't Print Jobs
Date:Wed, 16 Apr 2014 09:10 EDT
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Description:Alan Reynolds We have all been watching a long mystery with no ending: What the Federal Reserve governors are trying to do, how they intend to do it and why they imagine their efforts will work. The key questions boil down to two: (1) What target should the Fed aim at, and (2) what policy instruments should it use to hit that target? The Fed’s only explicit target — an unemployment rate of 6.5% — was shrewdly discarded as “outdated” as that target grew near. Actually, the idea of focusing on unemployment is outdated, since it presumes that high unemployment guarantees low inflation — as though stagflation in 1975 or 1982 could not have happened. Why not simply target inflation? Ben Bernanke advocated inflation targeting before 2002, when he became Fed chairman. On Nov. 21, 2002, he gave a speech warning that inflation was too low, threatening deflation. Today, as in 2002 or 1998, many are again warning that inflation is too low — just 1.1% last year when gauged by the deflator for personal-consumption expenditures (PCE), or 1.5% over the past 12 months, according to the March consumer price index. But the trouble with basing future policy on past inflation news is that inflation is always lower before it moves higher. PCE inflation rates of 0.8% in 1998 and 1.3% in 2002, for example, were followed by 2% inflation in 2003, 2.4% in 2004, and 2.9% in 2005. “In the end, economic growth depends on incentives to expand and improve labor and capital.” Many other central banks do set inflation targets, but the Fed encourages the popular delusion that central bankers, like central planners, possess the knowledge and skill to boost real economic growth and employment. Fed officials thus speak of their “dual mandate” to promote growth of the economy and jobs while keeping an eye on inflation. Prominent economists of all stripes have proposed that the Fed should focus instead on keeping the growth of nominal GDP (NGDP) growing at a steady rate. But growth of NGDP is simply the inflation rate added to the real GDP growth rate. So how does an NGDP target differ from a dual mandate? The graph above shows that before 2010, the Fed moved the federal funds rate up whenever nominal GDP growth picked up, and also reduced the fed funds rate when it slowed. The Fed often reacted to NGDP data with a lag — easing most aggressively in 1993 and 2003, long after recessions in 1990 and 2001. If the Fed reacted more promptly, how is an nominal GDP target supposed to work? A typical proposal, from James Pethokoukis at the American Enterprise Institute, is for the Fed to keep nominal GDP growing at a steady rate of 5%. But trying to keep NGDP growing at a 5% pace means inflation would have to speed up during recessions and decline in booms. If real GDP grew by 7.2%, as it did in 1984, the Fed would have to find some way to engineer a 2.2% deflation to wrestle NGDP down to 5%. If real GDP fell by 3.1%, as it did in 2009, the Fed would have to foster 8.1% inflation to push NGDP up to 5%. This is easier said than done. And why would anyone want to do it? If we had experimented with a 5% NGDP target in the past, it would mean that from 1983 to 2000, the Fed should have tightened policy more aggressively than it did during every single year but 1991. Yet those were years of strong economic growth and declining inflation. Far from being an “easy money” period, the federal funds rate was 3.6 percentage points higher than inflation. Swings in nominal GDP growth can be erratic, partly because of inventory cycles, foreign trade disruptions and government-spending spikes outside the Fed’s control. If the Fed decided to react to nominal GDP gyrations, then consumers, firms and investors might react badly to good news in quarterly GDP reports, anticipating that high rates must follow even ephemeral spurts in real growth. News of any possibility of exceeding the 5% speed limit would be a strong incentive for investors to panic and for consumers and retailers to stockpile durable goods before interest rates go up. If the Fed raised interest rates whenever nominal GDP exceeded 5%, they might just cut off the peaks in real GDP and leave the valleys. Monetary policy is far more effective in getting people to postpone spending than borrowing when they have good reasons to save. We know that the Fed has the power to crush real GDP — look at what happened after the fed funds rate hit 19% in January 1981. But we do not know if Fed policy could or should induce over-leveraged families and firms to spend income they don’t have. The currently fashionable fascination with a 5% (or higher) growth target for NGDP is that it suggests the Fed should have eased more than it did in every year since 2007. Yet it’s hard to imagine the Fed trying any harder than it has to stimulate demand after 2008. The fed funds rate has been more than a percentage point below the inflation rate for years. Annual growth of the M2 money supply from 2008 to 2013 was a brisk 6.7%. The problem with Fed policy has not been the target but the instruments used to hit the target. You can’t hit a bull’s-eye with a shotgun or a squirt gun. And you can’t hit two targets (inflation and unemployment) with just one gun. Adding more billions to excess bank reserves does nothing to encourage more bank lending, because banks have been unconstrained by reserves for years. Bank lending is far more constrained by regulations. To the extent that Fed efforts reduced interest rates for the private sector (rather than just for Uncle Sam), such lower interest rates may have raised the demand for loans, but they also reduced the supply. Bond yields did not rise when the Fed bought fewer bonds, raising doubts that QE even accomplished its goal of twisting (flattening) the yield curve. If it did succeed in flattening the yield curve, a flatter curve is normally associated with slower nominal growth, because banks borrow short and lend long. And super-low interest rates directly reduced the incomes of those, including seniors, holding liquid assets for security. At the moment, neither an inflation target nor a nominal GDP target suggest that the Fed needs to discourage the growth of money or credit — regardless of how much unemployment falls as people drop out of the labor force. If and when inflation and nominal GDP targets send conflicting messages, however, inflation is the one that matters. It can never be a matter of indifference whether the growth of NGDP consists of rapid real growth with little inflation (as in 1998), or rapid inflation with negative real growth (as in 1982). In the end, economic growth depends on incentives to expand and improve labor and capital. Sustained economic progress has essentially nothing to do with central banking so long as inflation is held in check. The Fed can print bank reserves, but it can’t print jobs. Alan Reynolds is a senior fellow with the Cato Institute.

Title:Ready to Join the International Community?
Date:Wed, 16 Apr 2014 08:49 EDT
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Description:Doug Bandow The United Nations Human Rights Council angered Iran by renewing the mandate of monitor Ahmed Shaheed, who has criticized Tehran’s abuses. His work remains vital as long as Iran violates its citizens’ most basic rights. At the same time nuclear negotiations continue. Dealing with Tehran could turn into the Obama administration’s greatest foreign policy success or another disaster. If the interim Geneva agreement leads to permanent denuclearization of the Islamic Republic of Iran, President Barack Obama can claim an achievement nonpareil. If the effort collapses, he will look dangerously naïve. Everything depends on whether Tehran, and not just President Hassan Rouhani, is serious. No surprise, many analysts — and more importantly, paladins of Capitol Hill — remain skeptical. And that doubt has fueled efforts to impose new sanctions, which would impede if not kill efforts to reach a final accord. If Iran is serious about joining the community of nations, it should demonstrate that commitment in practical ways. One of the most important symbols of Iranian irresponsibility today is its ruthless persecution of religious minorities. Many authoritarian regimes suppress political opponents — the one shared value among governments worldwide is staying in power. Far fewer seek to suppress the most basic exercise of human conscience. With an overwhelming Muslim majority, roughly 90 percent Shia, Iranian institutions will inevitably have an Islamic character. The government should not fear allowing those of other faiths to worship and live freely. There would be no more powerful reassurance for other nations of Tehran’s good intentions than for the Iranian authorities to respect religious liberty. The most celebrated case of persecution today is Saeed Abedini, an American citizen born in Iran and sentenced to eight years in prison last year for “undermining national security” by the Iranian government. The idea that the 33-year-old father of two threatens the regime is ludicrous. A Muslim convert to Christianity, he had been arrested and released on prior trips. His “crime” in Tehran’s view apparently was aiding house churches. He went to Iran in 2012 to set up an orphanage, with the government’s approval. Since then he was abused and tortured while held at Iran’s notorious Evin prison, and then transferred to Rajai Shahr prison, which may be even more dangerous. President Obama called for Abedini’s release. President Rouhani responded that he could not “interfere in the judicial process,” but left hope that the government might be able to “assist.” Unfortunately, Abedini is merely the symbol of broader religious repression. As adherents of a historic faith recognized by the constitution, Christians nominally are free to worship. But that right is highly constrained, as Iran has emerged as one of the globe’s worst persecutors. For instance, Tehran makes the World Watch List from Open Doors USA and the Hall of Shame from International Christian Concern. The European organization Human Rights Without Frontiers reported that Iran is one of the five top prison states for religious prisoners. The U.S. Commission on International Religious Freedom (USCIRF) has routinely labeled Tehran as a Country as Particular Concern. The Commission’s 2013 report concluded: “The government of Iran continues to engage in systematic, ongoing, and egregious violations of religious freedom, including prolonged detention, torture, and executions based primarily or entirely upon the religion of the accused.” In its latest religious liberty report the State Department noted that Iran’s “constitution and other laws and policies do not protect religious freedom, and in practice, the government severely restricted religious freedom.” “Iran should stop persecuting religious minorities.” Tehran’s brutal persecution has been getting worse. The International Campaign for Human Rights in Iran published a report on religious persecution last year, which noted that “In 2005, coinciding roughly with the election of President Mahmoud Ahmadinejad, the Iranian government ramped up its repression of Christian house churches, Persian-language Protestant churches, and converts. It has further intensified its efforts since 2010.” USCIRF reported that “since the disputed 2009 elections, religious freedom conditions in Iran have regressed to a point not seen since the early days of the Islamic revolution. Killings, arrests, and physical abuse of detainees have increased, including for religious minorities and Muslims who dissent or express views perceived as threatening the legitimacy of the government.” Mohabat News pointed to another increase in repression since 2011: “Many Christians, especially newly converted Christians, have faced imprisonment, pressure and harassment in the past few years.” ICHRI also focused on persecution of converts, who face not only government prosecution, but even more commonly “what are widely considered to be extrajudicial killings.” State concentrated on 2012, when “The government’s respect for religious freedom declined during the year.” Tehran increasingly was “charging religious and ethnic minorities with moharebeh (enmity against God), ‘anti-Islamic propaganda,’ or vague national security crimes for their religious activities.” Increasingly religious faith is being treated as a political threat. Said Indiana University Professor Jamsheed Choksy: “Most of the several hundred imprisoned members of religious minorities stand charged with threatening ‘national security’ and some even face capital punishment at the hands of revolutionary tribunals.” ICHRI explained that such charges sometimes were used as a substitute for apostasy, to lessen foreign criticism. Even the United Nations has criticized Iran for its pervasive repression, last year releasing a highly critical report from Ahmed Shaheed, the Special Rapporteur on Human Rights. He pointed to “widespread systemic and systematic violations of human rights.” Religious minorities are at particular risk, facing “discrimination in law and/or in practice. This includes various levels of intimidation, arrest and detention.” Currently the regime appears to be most concerned about conversions. Christians traditionally were minorities, especially Armenians and Assyrians, who speak a different language. However, the number of converts is increasing. HRWF reported that charges against those arrested last year included “conversion from Islam to Christianity, encouraging the conversion to Christianity of other Muslims, and propaganda against the regime by promoting Christianity as missionaries.” Since converts are denied government permits to operate churches, they tend to form home congregations, which are targeted by the authorities. The government also has focused on Farsi-language services at Christian churches, on the theory that they draw converts from Islam. Katrina Lantos Swett, who chairs the UCIRF, recently declared: “Conditions are at levels not seen since the early years of the revolution.” During last year’s Iranian presidential campaign the regime closed the country’s largest Farsi-language church, Central Assemblies of God Church in Tehran. Mohabat recently reported that Tehran’s St. Peter Church has told Farsi-speakers that is must drop its Farsi-language services. George Wood of the U.S. Assemblies of God was quoted by the Conservative New Service explaining that shutting down Farsi programs “would essentially remove all open witness of the gospel of Christ in the country.” Persecution today reflects both law and practice. Iran is a theocratic state whose laws are to be based on “Islamic criteria.” The constitution formally accords “full respect” to Christians, Jews, and Zoroastrians, who are allowed to worship “within the limits of the law.” Proselytizing and converting are barred, however. Moreover, according to the State Department, Jews are “regularly vilified” and the government “regularly arrests members of the Zoroastrian and Christian communities for practicing their religion.” Far worse is the treatment of other groups, such as Baha’is and other Muslims, including Sufis, Sunnis, and non-conformist Shia. The first are considered to be apostates. Atheists also are punished for “enmity against God.” Explained State, “The government prohibits Baha’is from teaching and practicing their faith and subjects them to many forms of discrimination not faced by members of other religions groups.” Sunnis face double jeopardy since many are ethnic minorities, such as Arabs and Kurds. Even dissenting Muslim clerics, according to USCIRF, are “intimidated, harassed, and detained.” Government hostility encourages private discrimination as well. Said State: “The government’s campaign against non-Shias created an atmosphere of impunity allowing other elements of society to harass religious minorities.” ICHRI reported that Christians “face systematic discrimination in almost all walks of life.” Every faith community is at substantial risk. Iran’s Jewish community is small, perhaps 25,000, but under President Mahmoud Ahmadinejad suffered through official anti-Semitism and Holocaust denial. President Rouhani has abandoned such rhetorical excesses, even wishing the Jewish community a happy Rosh Hashanah. But the hostile atmosphere runs deep. After the 1979 revolution, nearly a score of Jews were executed for alleged spying. In 2000 ten were convicted of spying for America and Israel in what appeared to be a fantasy plot. Christians also suffer. In 1990 Rev. Hossein Soodmand was executed for apostasy because he had converted from Islam three decades before. Four years later another Christian was sentenced to death on the same charges, though freed in response to international protests. However, Bishop Haik Hovsepian Mehr, who spoke out in the case, was murdered; his killer or killers were never identified. Persecution, though more through imprisonment than execution, has been rising since then, apparently for several reasons. Barnabas Aid concluded that the regime fears “the number of Iranian Muslims turning to Christ.” Kiri Kankhwende of Christian Solidarity Worldwide believed the regime saw non-Muslim beliefs “as a challenge to the very state itself.” Iranian officials also cite contacts with foreign-backed groups, as did ICHRI, which reported that the government’s campaign reflected the belief “that the house church movement is linked to ‘Western powers’ and ‘Zionists’ who are waging a soft war against the regime.” These fears have led to raids on established churches and home congregations, threats against and arrests of leaders and worshipers, and punishment for drinking communion wine. Hundreds of Christians were detained in the last two or three years, with an increase in frequency as last year’s election approached. ICHRI reported that “Christian detainees are often denied due process and basic rights. They are held in prolonged detention without formal charges, trials are held without access to counsel, or, if there is counsel, without access to court files, and ill treatment is common during detention.” Not everyone receives a lengthy term in prison. The International Campaign explained: “Most Christians arrested by authorities are eventually released, often with heavy bails. However, in many cases the investigations are never closed, nor are charges, if there are any, dismissed.” Thus, the threat of prosecution remains. Moreover, a number have been imprisoned, many of whose cases are detailed by ICHRI. Saeed Abedini is not the only high profile Christian prisoner. Convert Youcef Nadarkhani was arrested in 2009, sentenced to death, retried and acquitted, released, rearrested, and released early last year. His wife was sentenced to life imprisonment for apostasy and then released. Also officially recognized is Zoroastrianism, which predates both Christianity and Islam and has fewer than 100,000 followers. Yet adherents are monitored and treated as national security threats. Explained Choksy: “Like members of the Christian, Jewish and Baha’i minorities, Zoroastrian activists who protest the theocracy’s excesses are sent to Tehran’s notorious Evin prison on charges of sedition.” Lacking even a modicum of legal protection are Baha’is. Last year Supreme Leader Ayatollah Ali Khameini issued a fatwa calling Baha’is “deviant and misguided.” Thousands have been arrested since 1979. Heiner Bielefeldt, the UN Special Rapporteur on Freedom of Religion and Belief, called Iran’s treatment of Baha’is as among the most “extreme manifestations of religious intolerance and persecution.” Several Baha’i leaders arrested in 2008 are serving 20-year sentences. Kamran Hashemi reported in the Guardian: “Baha’i-owned shops are sealed or burned to the ground, cemeteries are desecrated, homes are raided and property is confiscated.” Perhaps the only way to receive worse treatment would be to declare oneself an atheist. The Shia regime also targets Sunni Muslims, who are prevented from building their own mosque or using rental facilities. Sunni clerics also have been arrested; believers, including university students, have been sentenced to death for proselytizing. The government also has destroyed worship places for Sufis and imprisoned individual believers. The situation for religious minorities in Iran is dire. The U.S. government has little direct leverage, having already applied targeted Tehran with economic sanctions over its presumed nuclear ambitions. However, Washington (and the Europeans) could indicate to Iran that a deal is more likely if it quiets Western skeptics. Reversing Iran’s recent policy of religious intolerance would offer an important signal. In fact, public pressure works. UN Special Rappoteur Shaheed reported last year that “At least a dozen lives were saved because of the intervention of international opinion.” ICHRI attributed Youcef Nadarkhani’s release “to international pressure.” Encouraging Tehran to respect the freedom of conscience of its citizens might even more effectively come from the most fervent advocates of engagement. How to best resist proposals for new Western sanctions? Ask Tehran to accept religious dissent. Candidate Rouhani promised to issue a “civil rights charter,” which sounded promising. However, his proposed legislation fails to adequately protect human rights. Today he needs to address those who doubt the Iranian authorities are genuinely committed to a new approach to international affairs. To prove they are, Tehran should release Rev. Abedini, pardon imprisoned Baha’is, allow Sufis and Sunnis to worship, and more. “The international community is watching,” observed Dwight Bashir, deputy director of USCIRF. Iran should act accordingly. Doug Bandow is a senior fellow at the Cato Institute. A former Special Assistant to President Ronald Reagan, he is the author and editor of several books, including The Politics of Plunder: Misgovernment in Washington (Transaction).

Title:Speech on Public College Campuses Liberated in One State
Date:Wed, 16 Apr 2014 05:20 EDT
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Description:Nat Hentoff On April 4, Virginia Gov. Terry McAuliffe signed into law a bill unanimously passed by the House of Delegates and the Senate, which turns outdoor areas on the state’s public college and university campuses into what the Foundation for Individual Rights in Education, or FIRE, calls “public forums.” In other words, student speech will not be limited to the tiny “free speech zones” that, as FIRE documents, restrict student speech in “1 in 6 of America’s 400 top colleges” in this land of the free and home of the brave. This is America? In these places of higher learning? As Greg Lukianoff, president of FIRE, keeps revealing, these tightly squeezed campus speech zones often result in “banishing student protests, leafleting and other basic expression (political or otherwise) to tiny areas far away from the students the speech is intended to reach” (“Virginia Legislature to Campuses: Down With Free Speech (Zones)!” Greg Lukianoff, Huffington Post, April 7). Of course, FIRE was deeply involved in this historic unleashing of Virginia students’ First Amendment rights. But what about the state’s private colleges and universities? The pressure will now be on them, too, to allow their students to be fully American by speaking freely on those campuses. It’s important to emphasize that, as FIRE does while it now goes on to give the First Amendment a home on other college campuses, “restricting student speech to tiny ‘free speech zones’ diminishes the quality of debate and discussion on campus by preventing expression from reaching its target audience” (“Virginia Bans Unconstitutional Campus ‘Free Speech Zones,’”, April 7). “Often, institutions that maintain these restrictive policies also employ burdensome permitting schemes that require students to obtain administrative permission days or even weeks before being allowed to speak their minds. “Even worse, many of these policies grant campus administrators unfettered discretion to deny applications based on the viewpoint or content of the speakers’ intended message.” Are students on those campuses learning to be active, knowledgeable participants in this self-governing republic? Virginia’s law, which FIRE is determined to extend to other states’ schools where it’s needed, “prohibits public institutions of higher education from imposing restrictions on the time, place and manner of student speech that occurs in the outdoor areas of the institution’s campus and is protected by the First Amendment to the United States Constitution …” However, there are restrictions. Watch for these exceptions, because they’re why FIRE always stays on and protects its victories: “the restrictions (i) are reasonable, (ii) are justified without reference to the content of the regulated speech, (iii) are narrowly tailored to serve a significant governmental interest, and (iv) leave open ample alternative channels for communication of the information” (from the State Council of Higher Education for Virginia, Meanwhile, FIRE will keep an eye on administrators at the University of Virginia, and so will its student members there, to make sure the law remains whole. In the history of this nation, no other organization has come close to FIRE in working to safeguard the individual constitutional liberties of college students of all backgrounds and beliefs. That’s why, almost from its inception, I’ve been on the Advisory Council of FIRE. Because I’m aware of all it does, I know FIRE doesn’t need my advice, so what I do is spread the word of its record of liberty, which would have made James Madison joyous. According to FIRE’s website, the organization is a “nonprofit educational foundation … (whose) mission is to defend and sustain individual rights at America’s colleges and universities. These rights include freedom of speech, legal equality, due process, religious liberty, and sanctity of conscience – the essential qualities of individual liberty and dignity.” It should also be noted that FIRE represents no political party – just the American people. In a pamphlet on college speech codes, FIRE says it’s “been fighting for student and faculty rights since 1999, and we’ve been very successful in doing so. Since our founding, FIRE has won over 190 public victories at more than 135 colleges and universities that have a total enrollment of nearly three million students. “FIRE is directly responsible for changing over 90 unconstitutional or repressive policies affecting more than 1.9 million students” (“Challenging Your College’s Speech Code,” All along, I’ve been hoping FIRE would also move the First Amendment into high schools. That is beginning to happen, as I’ll report on how this liberation of students and faculties brings the living Bill of Rights into those schools. And I yearn to live long enough to also see FIRE reach elementary-age students, teaching them how to be authentic Americans. Next week, with the aid of Joe Cohn, FIRE’s Legislative and Policy Director (who testified before both houses of Virginia’s General Assembly in support of the state’s campus free speech law), I will report on the organization’s involvement in another historic U.S. state decision: In 2013, “North Carolina Governor Pat McCrory signed a bill granting public university students in the state facing non-academic disciplinary charges the right to an attorney” (“North Carolina Becomes First State to Guarantee College Students’ Right to Attorney,”, Aug. 23, 2013). Explained FIRE Senior Vice President Robert Shibley: “Students across America are regularly tried in campus courts for serious offenses like theft, harassment, and even rape. Being labeled a felon and kicked out by your college carries serious, life-altering consequences. “Because the stakes are so high, students should have the benefit of an attorney to ensure the hearing is conducted fairly and by the rules.” So we have two firsts in the nation! Did you know about this law in North Carolina? Did you know the First Amendment is now flying high across many of Virginia’s college and university campuses? Where are the media? Nat Hentoff is a nationally renowned authority on the First Amendment and the Bill of Rights. He is a member of the Reporters Committee for Freedom of the Press, and the Cato Institute, where he is a senior fellow.

Title:Justice Stevens Is Right: Good or Bad, Death Penalty Is Constitutional
Date:Tue, 15 Apr 2014 09:27 EDT
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Description:Ilya Shapiro Justice John Paul Stevens has been getting lots of attention lately for his views on the Second Amendment—he still doesn’t like the individual right to keep and bear arms, and would amend the Constitution to get rid of it—but it’s his views on the death penalty that have provoked the more troubling reaction. Here’s the back-story: Justice Stevens has published a book, Six Amendments: How and Why We Should Change the Constitution. Three of these amendments are structural: (1) requiring state officials to enforce federal law; (2) eliminating state sovereign immunity; and (3) doing away with political gerrymandering. The other three are from the populist-progressive playbook: (4) the aforementioned Second Amendment tweak (which doesn’t make sense as drafted); (5) allowing Congress and state legislatures to censor political speech limit the money people can spend on election campaigns; and (6) outlawing the death penalty. The Atlantic’s Andrew Cohen latched onto this last one, lamenting that Stevens is: a man who consistently upheld capital convictions and the death penalty itself for over 35 years, who helped send hundreds of men and women to their deaths by failing to hold state officials accountable for constitutional violations during capital trials, who more recently endorsed dubious lethal injection standards because he did not want to buck up against court precedent, now wants the Eighth Amendment to read this way, with five new words added: “…nor cruel and unusual punishments such as the death penalty inflicted.” (The reference to lethal-injection standards relates to the 2008 case of Baze v. Rees, which upheld Kentucky’s particular method of execution. Stevens concurred in that ruling but wrote separately to question “the justification for the death penalty itself.”) Now, I don’t have any particular ax to grind regarding the death penalty as a policy matter—it’s probably warranted for serious crimes, but there are real problems with the way our justice system administers it—but as a question of law, it’s hard to argue that it’s always unconstitutional. The Fifth Amendment references “capital” crimes and outlaws putting someone’s “life” in jeopardy twice for the same crime, and both the Fifth and Fourteenth Amendments protect against being deprived of “life” without due process of law. “Too many commentators conflate that with which they agree with that which the constitution requires.” To be sure, the Eighth Amendment does prohibit “cruel and unusual punishments,” but that just means that the death penalty can’t be applied in a particularly inhumane way (for example, vivisection). Moreover, debates over the death penalty almost always occur in the context of state criminal law, over which the federal government has little authority. Yes, there’s a federal criminal code—much of which is itself of dubious constitutional authority given the outlandish reading courts have given Congress’s power to regulate interstate commerce—but it imposes capital punishment exceedingly rarely (three times in the last 50 years, not counting military justice). All the highest-profile Supreme Court cases thus force the justices to consider whether a state’s imposition of the ultimate punishment is “cruel or unusual,” not whether the death penalty is unconstitutional altogether. So if you want to abolish the death penalty, you either have to go state-by-state—18 states have done away with it, 6 since 2007—or, as Justice Stevens suggests, you have to amend the Constitution. But just because someone, even a Supreme Court justice, concludes that the death penalty is a bad idea, or immoral, or otherwise inappropriate, doesn’t make it unconstitutional. There can certainly be bad policies that are constitutional—or, for that matter, good policies that are unconstitutional. Indeed, given that it’s my wont to label legislation and government action as unconstitutional, I’m frequently asked if there are any policies I like that I nevertheless think violate our founding charter. It’s a hard question, given that the Constitution is fundamentally a classical liberal, or libertarian, document, which fits with my political philosophy. Nevertheless, my top two examples are environmental regulation—properly conceived; it’s inefficient to have a tort-law based system of regulating pollution that crosses state lines—and federal tort reform. But regardless of my personal views, too many commentators conflate that with which they agree with that which the constitution requires. Justice Stevens, even if he errs in his understanding of the right to armed self-defense and shouldn’t be proposing amendments, gets that right. Ilya Shapiro is a senior fellow in constitutional studies at the Cato Institute and editor-in-chief of the Cato Supreme Court Review. Follow him on Twitter.

Title:Abusive Civil Asset-Forfeiture Laws
Date:Mon, 14 Apr 2014 09:18 EDT
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Description:Richard W. Rahn Do you think the Internal Revenue Service and other government agencies should have the right to seize your assets, including your bank accounts, when you have not been convicted of wrongdoing? The fact is, the IRS and other government agencies do this all of the time, and often without even a formal accusation of wrongdoing. Anyone who is awake knows that the IRS has been politicized — and thus critics of the administration live in fear that their property will be taken for the mere act of speaking out against the government. The American Founding Fathers well understood that if the government was given too much power, it would almost certainly abuse it. Unfortunately, the elaborate system of checks and balances they devised has been steadily eroded by weak-kneed and intellectually bankrupt judges, members of Congress and presidents over the past two centuries, and thus, the United States increasingly resembles an authoritarian state rather than a republic that protects individual liberties. “Government seizure of property without due process should cease.” The government has always been able to seize private property that was used to perpetrate a crime or produced by a crime. Under the Constitution, every American has the right to be considered innocent until proven guilty. Thus, in criminal cases, the government has to convince a judge and jury beyond a reasonable doubt that a crime has been committed. Under civil asset-forfeiture laws, no such proof is required — and, as a result, many innocent people have had their property taken by agents of the federal government. As people become increasingly aware of the abuses, individual citizens and organizations formed to protect individual liberty are fighting back and beginning to win some cases. There was the widely publicized case of Terry Dehko and his daughter, who had owned a supermarket in Fraser, Mich., since 1978. The IRS seized their entire bank account of more than $35,000 in April 2013, without arguing before a court of law that the Dehkos had committed a crime. In fact, they had committed no crime. Fortunately, the Dehkos were able to enlist the help of the Institute for Justice, a civil-liberties law firm that works on the behalf of individuals. After a year of expensive litigation, the government did return their money. Institute for Justice lawyers have noted that the “federal civil forfeiture law features an appalling lack of due process: It empowers the government to seize private property from Americans without ever charging, let alone convicting, them of a crime.” “Perversely, the government then pockets the proceeds while providing no prompt way to get a court to review the procedure.” Originally, the civil forfeiture laws were passed to make it easier for the government to stop drug traffickers, money launderers and tax evaders. As always, agents of the government, rather than being careful and judicious in the use of their new powers, quickly abused them. As Lord Acton warned, “Power tends to corrupt, and absolute power corrupts absolutely”. Consequently, Americans are left with a situation where government agents can seize private property (while often benefiting directly or indirectly from the seizure), where the citizen is given no due process, and where government agents have used their powers to take revenge or harass their political opponents. If the government seizes your bank account, where do you get the money to hire a lawyer to defend yourself? The Institute for Justice and others have called for reforms, including allowing property owners subject to civil forfeiture to have speedy access for a prompt trial before a judge, having the presumption of innocence until proven guilty, and to reduce conflicts of interest, making sure seized assets are separated from the budgets of law enforcement. While such changes would surely be an improvement, they still leave too much power in the hands of IRS and other federal agents. The tax code has grown to such an extent that no one person in the IRS or outside of government can fully understand it — so whether one is in compliance is increasingly subjective and vague. Often incomprehensible law (which characterizes both the tax code and anti-money laundering laws and regulations) administered by politicized government agencies will result in abuse. The only real solution to protect the rights of the individual is to either repeal the income tax and anti-money laundering laws, or repeal all the civil asset-forfeiture laws, including the right of the IRS to seize bank accounts. Some on both the right and the left will scream that repeal of civil forfeiture will make the job of the crime fighter and tax collector more difficult, which it will. However, the alternative is for innocent citizens to live in fear of their assets being seized by overzealous, politicized or corrupt government agents. Losing some tax revenue and having a few money launderers go free is a small price to pay for keeping our civil liberties. Richard Rahn is a senior fellow at the Cato Institute and chairman of the Institute for Global Economic Growth.

Title:Deputizing Everyone Isn't Producing Results against Terrorism, but Officials Keep Trying
Date:Mon, 14 Apr 2014 09:10 EDT
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Description:Gene Healy “If you see something, send something.” That’s the slogan for Ohio Homeland Security officials’ spiffy new “Safer Ohio” smartphone app, whose release coincides with the one-year anniversary of the Boston Marathon bombings. It’s “Ohio’s multi-function mobile public safety tool,” the department brags; concerned citizens can use it to snap and submit camera phone pics of anything that raises their hackles, thereby “report[ing] suspicious activity directly to the state’s round the clock public safety intelligence analysts.” “The campaign for citizen vigilance seems to have done little besides generate an atmosphere of perpetual, low-level anxiety and excuses for official harassment.” The instructional video that goes with the app is, well, instructive. What kinds of potential perils do Buckeye State bureaucrats want flagged for follow-up? The video provides an example: a picture of what looks like a man-purse lying on the carpet next to an office filing cabinet. “You can send just a message,” the robotic voiceover intones, or text a photo; “Either way, analysts will follow up on every tip.” No wonder they’re there around the clock. Remember Operation TIPS? That was the Bush administration’s 2002 “Terrorism Information and Prevention System,” a scheme to assemble a legion of volunteer citizen-informants drawn from the ranks of mail carriers, utility employees and others with special opportunities to observe and report. The resulting public outcry led Congress to bar the program later that year, in the bill creating the Homeland Security Department. But Homeland Security officials at the federal, state and local levels have apparently concluded that TIPS’s basic concept is sound — so long as you deputize everyone. We’ve had more than 10 years’ experience with “if you see something, say something,” and the results are nothing to write home about. The brainchild of a now-defunct ad agency, the campaign started in New York City, with posters urging straphangers to phone in tips. By 2008, the Metropolitan Transit Authority was running ads boasting that “last year, 1,944 New Yorkers saw something and said something.” Campaign-inspired calls had resulted in 18 arrests over two years, none terrorism-related. By 2010, DHS wanted a piece of the inaction, securing a license to take the campaign federal, with then-DHS Secretary Janet Napolitano’s stern monotone echoing through the Washington Metro and Walmarts nationwide. The Kentucky Office of Homeland Security, which launched its own smartphone app in 2011, offers tips on “Recognizing Suspicious Activity”: it can include “trying not to be noticed” or “avoiding eye contact.” It’s “not a hard science,” they admit, but take a crack at it. There’s no indication that any of these programs have worked any better than the original campaign in New York. As Ohio State University political scientist John Mueller notes, his “examination of all known terrorism cases since 9/11 that have targeted the United States suggests that the ‘If You See Something, Say Something’ campaign has never been relevant.” That doesn’t mean it’s been costless. The problem is one of “too many ‘dots,’” as the Congressional Research Service puts it; the “challenge” with suspicious-activity reporting is that it can “result in an avalanche of largely irrelevant or duplicative data while diverting the police from more productive law enforcement activities.” Worse still, the “say (or send) something” crusade has resulted in government databases filled with “suspicious activity reports” describing constitutionally protected activity like protesting “excessive force by law enforcement.” As Mueller puts it, such programs have had little benefit save perhaps the dubious one of ”bolstering support for homeland-security spending by continually reminding an edgy public that terrorism might still be out there.” The campaign for citizen vigilance that began in the subways and is now migrating to our iPhones seems to have done little besides generate an atmosphere of perpetual, low-level anxiety and excuses for official harassment. That’s the sort of threat we could stand to be more vigilant about. Gene Healy, a Washington Examiner columnist, is vice president at the Cato Institute and author of The Cult of the Presidency.

Title:Gujarat Is India's Top State in Economic Freedom
Date:Sun, 13 Apr 2014 09:02 EDT
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Description:Swaminathan S. Anklesaria Aiyar Does Narendra Modi actually have a great Gujarat model, or just well packaged hype? Critics say that Gujarat has grown fast, but some others have grown faster. The Raghuram Rajan Committee on development indicators says Gujarat’s social indicators are just middling. Looking at children of class 3-5 who can do subtraction, Gujarat has declined from 22nd among 28 states in 2006 to 23rd in 2012. However, economist Arvind Panagariya argues that Gujarat has made substantial social progress under Modi, starting from a low base. “EFSI and other studies show that Gujarat has good governance.” Forget this debate. Neither growth nor social indicators are accurate measures of Modi’s main election plank — good governance. Measuring governance is difficult, and hence neglected by statisticians. Yet it’s all-important. One annual report has long provided indicators of governance. This is Economic Freedom of the States of India (EFSI), written by Bibek Debroy, Laveesh Bhandari and me. The 2013 EFSI report shows Gujarat has been No. 1 in economic freedom for the last three years, widening its lead over others. On a scale from 0 to 1, its overall freedom score has improved from 0.46 to 0.65. Tamil Nadu comes a distant second with 0.54. Economic freedom is not identical to good governance. But lack of economic freedom typically means poor governance — a jungle of rules and obfuscating bureaucrats that promote corruption, delay and harassment. This hits everybody from farmers and consumers to industrialists and transporters. What exactly is economic freedom? EFSI uses a methodology adapted from Economic Freedom of the World, an annual publication of the Fraser Institute. Data for Indian states is not available on many issues. So, EFSI limits itself to 20 indicators of the size and efficiency of state governments, their legal structure and property rights, and regulation of labour and business. Many of these indicators directly measure governance — the proportion of stolen property recovered; proportion of judicial vacancies; proportion of violent crimes; proportion of investigations completed by police and of cases completed by the courts; and the pendency rate of corruption cases. The list is by no means comprehensive, but provides strong clues. Gujarat is the best state in pendency of corruption cases, and in the proportion of non-violent crime. It is close to the top in completion of police investigations. It scores poorly in judicial vacancies and recovery of stolen property. Its quality of government spending is high: it has the lowest ratio of administrative GDP to total GDP. Spending is focused on infrastructure rather than staff. Modi’s repeated state election victories show that his approach produces high voter satisfaction. Gujarat is not a classical free-market state. It has large, expanding public sector companies, and substantial taxes on capital and commodities. It has many subsidies, though fewer than in other states. Still, business thrives in its business-friendly climate. One businessman told me that in Tamil Nadu, it took six months and several visits (and payments) to ministries for industrial approval. But in Gujarat, the ministry concerned called him the day before his appointment, asking for details of his proposal. Next day, he found the bureaucracy had in advance prepared plans of possible locations for his project, and settled the matter on the spot. This was unthinkable elsewhere, and showed both efficiency and honesty. Corruption has not disappeared in Gujarat, but is muted. Modi’s Jyotigram scheme provides 24/7 electricity for rural households, plus reliable power at fixed times for tubewells. This explains why Gujarat has India’s fastest agricultural growth (10%/year for a decade, say economists Gulati and Shah). Indian agriculture is crippled by regulations, but Gulati shows that Gujarat has the highest agricultural freedom among states. Modi charges farmers for power, and so all his three state power companies are profitable. By contrast, power companies in other states with free rural power have accumulated losses of almost Rs 200,000 crore. Critics accuse him of giving cheap land to favoured industrialists. But state and national governments the world over use such sops to attract industries. Unlike most politicians, Modi has clearly not enriched himself. Good governance includes communal peace. So, the 2002 Muslim killings reflect terribly on Modi. For some, it puts him beyond the pale. But since 2002 the state has been peaceful. In 2011-12 , Gujarat had the lowest Muslim rural poverty rate among all states. Its overall poverty rate for Muslims (11.4%) was far lower than for Hindus (17.6%). This was also true of six other states, so Gujarat is not unique in this. In sum, EFSI and other studies show that Gujarat has good governance. It has social and communal flaws. But it is India’s top state in economic and agricultural freedom. That’s not hype. Swaminathan S. Anklesaria Aiyar is a research fellow at the Cato Institute with a special focus on India and Asia.

Title:The NSA's Heartbleed Problem Is the Problem with the NSA
Date:Sat, 12 Apr 2014 13:29 EDT
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Description:Julian Sanchez The American intelligence community is forcefully denying reports that the National Security Agency has long known about the Heartbleed bug, a catastrophic vulnerability inside one of the most widely-used encryption protocols upon which we rely every day to secure our web communications. But the denial itself serves as a reminder that NSA’s two fundamental missions — one defensive, one offensive — are fundamentally incompatible, and that they can’t both be handled credibly by the same government agency. In case you’ve spent the past week under a rock, Heartbleed is the name security researchers have given to a subtle but serious bug in OpenSSL, a popular version of the Transport Layer Security (TLS) protocol — successor to the earlier Secure Sockets Layer (SSL) — that safeguards Internet traffic from prying eyes. When you log in to your online banking account or webmail service, the little lock icon that appears in your browser means SSL/TLS is scrambling the data to keep aspiring eavesdroppers away from your personal information. But an update to OpenSSL rolled out over two years ago contained a bug that would allow a hacker to trick sites into leaking information — including not only user passwords, but the master encryption keys used to secure all the site’s traffic and verify that you’re actually connected to rather than an impostor. “The NSA’s two fundamental missions — one defensive, one offensive — are fundamentally incompatible.” It’s exactly the kind of bug you’d expect NSA to be on the lookout for, since documents leaked by Edward Snowden confirm that the agency has long been engaged in an “aggressive, multi-pronged effort to break widely used Internet encryption technologies”. In fact, that effort appears to have yielded a major breakthrough against SSL/TLS way back in 2010, two years before the Heartbleed bug was introduced — a revelation that sparked a flurry of speculation among encryption experts, who wondered what hidden flaw the agency had found in the protocol so essential to the Internet’s security. On Friday, Bloomberg News reported that Heartbleed had indeed been added to NSA’s arsenal almost immediately after the bug appeared, citing two anonymous sources “familiar with the matter”. Within hours, the intelligence community’s issued an unusually straightforward denial, free from the weasely language intelligence officials sometimes employ to almost-but-not-quite deny allegations. As the statement pointed out, the federal government itself “relies on OpenSSL to protect the privacy of users of government websites and other online services.” If NSA had found such a serious security hole, the agency would have disclosed it, officials asserted. Moreover, the White House has recently “reinvigorated” the “Vulnerabilities Equities Process” designed to ensure that newly-discovered exploits aren’t kept secret any longer than is absolutely necessary for vital intelligence purposes. As Indiana University cybersecurity expert Fred Cate points out, however, the intelligence community’s track record of misleading statements about its capabilities means even such a seemingly unambiguous denial has been greeted with some skepticism. And even if we take that denial at face value when it comes to Heartbleed, reports of NSA’s 2010 “breakthrough” suggest they may be sitting on other, still-undisclosed vulnerabilities. Here, however, is the really crucial point to recognize: NSA doesn’t need to have known about Heartbleed all along to take advantage of it. The agency’s recently-disclosed minimization procedures permit “retention of all communications that are enciphered.” In other words, when NSA encounters encryption it can’t crack, it’s allowed to — and apparently does — vacuum up all that scrambled traffic and store it indefinitely, in hopes of finding a way to break into it months or years in the future. As security experts recently confirmed, Heartbleed can be used to steal a site’s master encryption keys — keys that would suddenly enable anyone with a huge database of encrypted traffic to unlock it, at least for the vast majority of sites that don’t practice what’s known as “forward security”, regularly generating new keys as a safeguard against retroactive exposure. If NSA moved quickly enough — as dedicated spies are supposed to — the agency could have exploited the bug to steal those keys before most sites got around to fixing the bug, gaining access to a vast treasure trove of stored traffic. That creates a huge dilemma for private sector security experts. Normally, when they discover a vulnerability of this magnitude, they want to give their colleagues a discreet heads-up before going public, ensuring that the techies at major sites have a few days to patch the hole before the whole world learns about it. The geeks at NSA’s massive Information Assurance Directorate — the part of the agency tasked with protecting secrets and improving security — very much want to be in that loop. But they’re part of an organization that’s also dedicated to stealing secrets and breaking security. And security companies have been burned by cooperation with NSA before: the influential firm RSA trusted the agency to help them improve one of their popular security tools, only to discover via another set of Snowden documents that the spies had schemed to weaken the software instead. Giving NSA advance warning of Heartbleed could help the agency protect all those government systems that were relying on OpenSSL to protect user data — but it also would aid them in exploiting the bug to compromise privacy and security on a massive scale in the window before the fix was widely deployed. Little wonder, then, that the President’s Review Group on Intelligence and Communications Technologies — informally known as the Surveillance Review Group — dedicated a large section of its recent report, Liberty and Security in a Changing World, to this basic tension. “NSA now has multiple missions and mandates, some of which are blurred, inherently conflicting, or both,” the Review Group wrote. “Fundamentally NSA is and should be a foreign intelligence organization” rather than “an information assurance organization.” Because Internet security depends on trust and cooperation between researchers, the mission of a security-breaking agency is fundamentally incompatible with that of a security-protecting agency. It’s time to spin off NSA’s “defense” division from the “offense” team. It’s time to create an organization that’s fully devoted to safeguarding the security of Internet users — even if that might make life harder for government hackers. Julian Sanchez is a research fellow at the Cato Institute.

Title:Ten Ways the Income Tax Harms Civil Liberties
Date:Fri, 11 Apr 2014 11:29 EDT
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Description:Chris Edwards The Internal Revenue Service scandal over the targeting of conservative groups has highlighted the agency’s power to obstruct our political freedoms. Filing taxes every April also drives home how the government reduces our freedom. Chief Justice John Marshall famously observed in 1819 that “the power to tax involves the power to destroy.” That’s true of any tax, but the massive federal income tax harms civil liberties much more than is necessary to raise the needed funds. “Congress should pursue major tax reforms that not only unshackle the economy but also expand our civil liberties.” Some members of Congress have been talking about tax reform. But their efforts so far have been accounting-driven exercises that simply tweak the monstrous code. Instead, Congress should pursue major tax reforms that not only unshackle the economy but also expand our civil liberties. Here are 10 freedom-crushing aspects of the income tax that policymakers should tackle: 1. Complexity and Ambiguity. Certainty in the law is a bulwark against arbitrary and abusive government. But there is no certainty under the income tax because it has an inherently complex base that is shot full of loopholes. Many studies have found that citizens, tax professionals, and the IRS all commit a large number of errors on their tax calculations. Looking at these studies, Professor David Vance of Rutgers University recently concluded that “the tax code is so complex that it is unconstitutionally vague,” likely violating due process under the Fifth Amendment. 2. Huge Size and Instability. Citizens are required to know the laws and comply with them. Yet federal tax rules are massive in scope and constantly changing. Tax laws, regulations, and related rules span 74,608 pages, according to CCH Inc. The number of pages has more than tripled since President Jimmy Carter called the tax system “a disgrace to the human race.” CCH estimates that there have been almost 5,000 changes to the federal tax code over the last decade. 3. Vertical Inequality. Although equality under the law is a bedrock American principle, the income tax treats citizens very unequally. Vertical inequality means different tax burdens on citizens of different incomes. For example, households earning between $100,000 and $500,000 pay an average income tax rate two and a half times higher than those earning between $50,000 and $100,000. Such inequities violate the spirit of equal protection under the Constitution. 4. Horizontal Inequality. Even people with similar incomes are treated unequally by the many exemptions, deductions, credits of the income tax. For example, the tax differences between homeowners and renters with the same incomes can be thousands of dollars because of the mortgage interest deduction. 5. Lack of Privacy. The income tax generates a large invasion of our privacy. The IRS gains access to mortgage records, credit card data, bank records, college tuition data, medical expenses, and much else. The broad IRS authority to obtain records without court supervision was referred to by the Supreme Court in 1964 as “a power of inquisition.” A huge and growing problem with the IRS amassing all this data is identity theft. The IRS has had to assign more than 3,000 agents to deal with this crime. 6. Denial of Due Process. In addition to the tax code’s complexity, the Fifth Amendment right to due process is ignored in other respects under the income tax. Due process requires that government provide accused citizens a clear notice of a claim against them and allow them a hearing before executing enforcement action. But the IRS engages in many summary judgments, and enforces them prior to any judicial determinations. 7. Shifting the Burden of Proof. For non-criminal tax cases — the vast majority of cases — the tax code reverses the age-old common law principle that the burden of proof rests with the accuser. Except in some narrow circumstances, the IRS does not have to prove the correctness of its determinations. When the IRS makes erroneous assessments — as it often does — citizens carry the burden to prove that they are wrong. 8. No Trial by Jury in Tax Court. Despite Sixth and Seventh Amendment guarantees of trial by jury, the federal tax system sidesteps such protections. To contest an IRS tax calculation prior to assessment, one must file a petition in the U.S. Tax Court. But since this is an administrative court, not an Article III court, no jury trial is required. To obtain a jury trial and related rights for civil tax cases, one must file suit in a U.S. District Court. But before that can happen, the alleged tax, penalties, and interest must be paid in full. 9. Unreasonable Searches and Seizures. In most situations, the Fourth Amendment guarantees that, before the government can search private property and seize records, it must demonstrate to a court that there is probable cause to believe that lawless conduct exists. However, the IRS’s summons authority under tax code section 7602 allows it to obtain records of every description from any person without showing probable cause and without a court order. In recent years, there has also been a big expansion in information reporting required by the IRS and in its computer searching for personal records. 10. Forced Self-Incrimination. The requirement to file tax returns under penalty of perjury operates to invalidate the Fifth Amendment protection against self-incrimination. Citizens face a legal dilemma. On the one hand, refusing to file a return would expose a citizen to prosecution for failure to file. On the other hand, disclosing information sought in tax returns constitutes a waiver of Fifth Amendment protections. The IRS can and does release that information to federal, state, and local agencies for both tax and non-tax law enforcement purposes. What should Congress do about all this? The first thing should be to greatly cut the government’s size to reduce its rapacious demand for our money. The next thing should be to proceed with a pro-growth and pro-freedom tax overhaul, which optimally means scrapping the income tax altogether in favor of a low-rate, consumption-based tax system. Chris Edwards is editor of at the Cato Institute.

Title:Three Things You Don't Know about Money in Politics
Date:Fri, 11 Apr 2014 11:23 EDT
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Description:Trevor Burrus Many are angry after the Supreme Court’s decision last week in McCutcheon v. FEC, which struck down the limit on how much someone can contribute in total to all candidates combined. In the current political climate, few things seem to inflame the passions like the ominous specter of “money in politics.” There are also few areas where people are more misinformed. Here are three truths about campaign spending that may calm some nerves. Campaign spending increases voter knowledge. “Money in politics elicits ire, but rarely does that ire come with understanding.” This may seem counter-intuitive, but imagine a world where contribution limits to candidates were set at $50, or even $100. It would take a long time to amass enough money to run just a single ad telling voters your name and ideals. Challenging an incumbent under those conditions would be nearly impossible. This is one reason why incumbents tend to like campaign finance laws. Moreover, many studies have shown that ads increase voter knowledge, interest, and even turnout. One study concluded that “exposure to campaign advertising can produce citizens who are more interested in a given election, have more to say about the candidates, are more familiar with who is running, and are ultimately more likely to vote.” Money doesn’t buy elections. Money is important in elections, particularly when challenging an entrenched incumbent with name recognition and media presence. For a House candidate, the first $500,000 or so is absolutely crucial. After that, the returns diminish sharply, and each next dollar spent is worth less than the last. However, dumping massive amounts of cash into an election certainly does not guarantee victory. Take former eBay CEO Meg Whitman, who spent $144 million of her own money only to lose the California gubernatorial race to Jerry Brown. Or conservative donor Sheldon Adelson, who spent $42 million in 2012 backing nine candidates with only one of them winning. Or the Koch brothers, who spent $33.5 million on ads attacking Obama, and we know how that turned out. True, the higher-spending candidate usually wins the election, but did he/she winbecause of the money? That’s a more difficult question. Donors like to back winners, and they will often give to candidates just because they think they will win. This is especially true when low contribution limits make it difficult for a single donor to make a big difference in the outcome. Rather than giving a small amount to someone who will lose anyway, they give to the leading candidate. Candidates in safe districts, districts where the margin of victory all but ensures that one party will win, still get donations. According to election guru Nate Silver, the number of landside districts has doubled since 1992. There are now 242 of them. Candidates who oppose the entrenched party or incumbent receive very few donations and party support, thus essentially ensuring that, in those 242 districts, the “bigger spending” candidate will win. But it is the demographics and gerrymandering that cause those victories, not the spending. Political opinions do not significantly correlate with wealth. Although it seems to be a common and fervently held belief, wealth and socioeconomic status do not effectively predict political beliefs. There are poor Democrats and rich Democrats, same as Republicans. For every Sheldon Adelson there’s a George Soros. For every Charles Koch there’s a Warren Buffett. There is nothing inherent about having money that makes someone a Republican. However, over the past two election cycles, heavy spenders backing GOP candidates have garnered much of the hatred and headlines. But it is easy to imagine a world where pronounced Democratic dissatisfaction with a Republican president creates a fundraising bonanza for Democrats. In fact, we saw that when Obama broke fundraising records in 2008. In one recent Gallup poll, the top 1% are 33% self-identified as Republicans and 26% self-identified as Democrats, a slight, but not a strong, tilt toward Republicans. If we include the leanings of independents, the Gallup poll found that 57% of the “nation’s wealthiest” associate themselves with the GOP. This slight lean towards self-identified Republicans, however, is difficult to disentangle from the fact that people in general are far more likely to self-associate as conservative rather than liberal. People apparently just don’t like to call themselves liberals. In terms of policy preferences, however, it’s long been known that there is little difference along the socioeconomic spectrum in support for policies that are arguably in the self-interest of either the poor or the rich. There is no evidence that shows that freeing up campaign spending will inevitably create policies that prefer the wealthy. Many think this is naive because “obviously” our policies prefer the wealthy, despite the fact that 70% of federal spending goes to the poor and middle class and the richest 10% pay 53% of all federal income taxes. If the debate is just about what policies benefit the poor or rich, then we’re back to the same policy debates that have been going on for decades but couching them in discussions about money in politics. Money in politics elicits ire, but rarely does that ire come with understanding. Blaming money in politics for perceived policy failures also provides a convenient explanation for why the world doesn’t align with your policy preferences. Thus, many people believe that stopping political spending and shutting up “outside influences” is the best way to create desired policy change. This motivation should be seen for what it is: censorship. The First Amendment exists to protect political speech of all types, including, and especially, “wrong” speech. You can disagree with what someone says but still defend to the death his right to say it, even if it is Sheldon Adelson. Trevor Burrus is a Research Fellow at the Cato Institute’s Center for Constitutional Studies.

Title:Whistleblowers Need Protection
Date:Fri, 11 Apr 2014 09:23 EDT
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Description:Doug Bandow Zimbabwe’s Robert Mugabe is a corrupt authoritarian. The United Nations is a wasteful, inefficient organization that tolerates corrupt authoritarians. Unfortunately, the two don’t make beautiful music together. Not everyone at the U.N. is corrupt. One hero is Georges Tadonki, a Cameroonian who for a time headed the U.N. Office for the Coordination of Humanitarian Affairs in Zimbabwe. The others are three judges in a United Nations Dispute Tribunal who, last year, ruled for Tadonki in a suit against the international organization. Soon we will find out if members of a U.N. appeals panel possess equal courage. That ruling is expected soon with rumors circulating that these judges might reverse course and absolve the organization of misconduct. “Something is very wrong with the U.N.” In 2008, President Robert Mugabe, who took power in 1980, and ZANU-PF, the ruling party, were employing violent intimidation to preserve their control. At the time Tadonki had been on station for six years and predicted epidemics of both cholera and violence. Journalist Peta Thornycroft interviewed Tadonki at the time, concluding that the OCHA official was unafraid to speak the truth, making him “another kind of U.N. voice — one that I was not used to in Zimbabwe.” Unfortunately, U.N. country chief Agostinho Zacarias apparently was a more traditional international bureaucrat and dismissed Tadonki’s warnings. By the end of the year 100,000 people had been infected with cholera and thousands had died. During the election campaigns hundreds also had been killed by government thugs, who succeeded in derailing democracy. In April 2008, Tadonki warned U.N. headquarters that the country team was “not prepared to face the consequences of an emergency silently in the making” and hesitantly “responded to acts of political violence.” Zacarias denied the charges as Zimbabwe descended into deadly chaos. Naturally, no good deed went unpunished. After extended discord between the two U.N. officials, Tadonki was fired in January 2009. There was little doubt that the action was retaliation for being right and embarrassing Zacarias — who now serves the U.N. in South Africa. The controversy demonstrates that something is very wrong with the U.N. system. Observed writer Armin Rosen: “This case involves more than just a single U.N. bureaucrat enjoying a disturbingly close relationship with one of the most oppressive governments on earth. The U.N. system also actively abetted a toxic organizational status quo in Zimbabwe, even when it meant ruining the career of an employee who the [review U.N.] tribunal found to be a talented humanitarian professional and a courageous whistleblower — and even if it meant putting thousands of Zimbabweans’ lives in danger.” Tadonki decided to fight, though he had to ask the international law firm Amsterdam & Peroff to handle the litigation on a pro bono basis. Last year, the U.N. Dispute Tribunal based in Kenya heard his case, and Judges Vinod Boolell, Nkemdilim Izuako and Goolam Merran issued their 104-page judgment. They concluded “that the applicant was not, at all material times, treated fairly and in accordance with due process, equity and the core values of the Charter of the Organization” and that OCHA management ignored the U.N.’s “humanitarian values.” The tribunal ordered the U.N. to apologize for its misbehavior, investigate the mistreatment of Tadonki, hold his superiors accountable for their misconduct, cover Tadonki’s litigation costs, pay past salary through the judgment date, and provide $50,000 in “moral damages for the extreme emotional distress and physical harm suffered by the applicant.” Explained the judges: “This case has brought to light not only managerial ineptitude and highhanded conduct but also bad faith from the top management of OCHA. This mismanagement and bad faith were compounded by a sheer sense of injustice against the applicant who was hounded right from the beginning.” Perhaps even worse was the larger environment in which this misconduct occurred. Observed the tribunal: “There was a humanitarian drama unfolding, and people were dying. Part of the population had been abandoned and subjected to repression. The issue between Tadonki and Zacarias was to what extent these humanitarian concerns should be exposed and addressed and the risk that there was of infuriating the Mugabe government.” The tribunal’s conclusion is devastating: “The political agenda that RC/HC Zacarias was engaged in with the Government of Zimbabwe far outweighed any humanitarian concerns that OCHA may have had.” Of course, “The U.N. and Zacarias’s chief responsibility should have been to Zimbabwe’s embattled civilian population. Instead, both failed to live up to their obligations — even as they were conspiring against someone who had exceeded them.” But the final resolution depends on the appellate process, which is approaching its decision. Hopefully, Georges Tadonki and the three tribunal judges are not the only U.N. officials willing to do what’s right, irrespective of cost. Doug Bandow is a senior fellow at the Cato Institute and a former special assistant to President Ronald Reagan.

Title:The Zombie Political Economy of Algeria
Date:Fri, 11 Apr 2014 09:12 EDT
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Description:Dalibor Rohac and Nouh El-Harmouzi Campaigners for Abdelaziz Bouteflika, the 76-year old Algerian president who is seeking re-election for a fourth consecutive term, promise “broad democracy” if their candidate wins. After decades of oppression and authoritarianism, Algerians have little reason to believe them. Scepticism is appropriate not only about the government’s promises of political liberalisation but also about the prospects for prosperity in the country. With a GDP per capita of $5,404, Algeria may not be the poorest country in the region, but its performance is heavily dependent on an oil sector that has been in decline for years. Hydrocarbons form one third of the total economy but account for practically all of Algeria’s exports. “Algeria may not be the poorest country in the region, but its performance is heavily dependent on an oil sector that has been in decline for years.” Since the 1970s, Algeria’s economy has suffered from ‘Dutch disease’, which has made its exports less and less competitive on global markets and added to political pressure to insulate the country against foreign competition. Even today, Algeria is not a member of the World Trade Organization and maintains an extensive system of tariff protection. The legacy of a statist past is palpable. Both Ahmed Ben Bella, the country’s first president, and his successor, Colonel Houari Boumediene, tried to replicate the Soviet economic model. Following the confiscation of large land holdings of French colonists, Ben Bella experimented with socialist self-governance (‘autogestion’) in agriculture, while Boumediene nationalised much of Algerian industry, including oil production, and tried to impose central planning. The precarious economic conditions of the 1980s and power struggles between elements of the military and the security apparatus dragged the country into a protracted civil war, which ultimately led to the emergence of yet another strongman — the now increasingly frail Bouteflika (pictured above), who has been in power continuously since 1999. Bouteflika’s success has been in balancing the influence of the military and of the state security (‘DRS’) — the two factions traditionally competing for power in Algeria — leading to a seeming stability and a fall in the number of political assassinations in the 2000s. Yet, that came at the cost of an authoritarian, one-man regime characterised by patronage and rampant corruption. Political freedoms — including the freedom of the press and political association — were systematically disregarded. Bouteflika’s heavy-handed regime weathered the Arab protests and even the mild stroke suffered by the president last year, since when his public appearances have been rare. Algeria’s economy reflects the sclerotic nature of the country’s government. The political rigidity observed during the events of the Arab Spring came at the price of expansionary public spending, financed by shrinking oil revenue. Because of windfall gains from oil, spending increases have not translated into Greece-like budget deficits. However, should oil prices decline, Algeria’s fiscal position would quickly become unsustainable. As with many other countries in the region, Algeria’s government subsidises hydrocarbon products, spending almost 16 per cent of GDP on explicit and implicit subsidies. And, as elsewhere in the region, the benefits from subsidies accrue disproportionately to richer Algerians and not to those households in need. The list of Algeria’s troubles is predictable: discretionary use of hydrocarbon revenues, variable inflation, sluggish growth of the private sector, and high unemployment among young people. Limited access to credit, red tape and corruption are suffocating entrepreneurship. Economic growth outside of hydrocarbons is sluggish and relies disproportionately on government spending. Worse still, the ossified government makes any departure from the status quo difficult. Poor economic performance fuels ethnic tensions. In the town of Ghardaia, 600 kilometers south of Algiers, frequent clashes have been taking place between the Mozabites (a group of Berbers) and the Chaambas (a historic Arab tribe). These are illustrative of the growing sense of dissatisfaction in the country’s oil-rich, yet underdeveloped, south. In the approach to next week’s elections, the government decided to plant 1.5m palm trees along the main streets of Algiers as a symbol of the country’s longevity and its capacity for renewal. Contrary to expectations, the project sparked ire among local residents, tired of the municipal mismanagement and terrible state of public services. Yet, given the support for Bouteflika from the main political parties, labour unions and the ‘deep state’, it seems unlikely than any of his challengers — including Ali Benflis, a former leader of the ruling FLN party — will garner enough votes to displace him on April 17. According to Hocine Malti, the retired vice-president of Sonatrach, Algeria’s oil company, the divisions within the security apparatus run deep even after years of Bouteflika’s rule. However, all factions have an interest in the continuation of the status quo, which enables them to share oil rents and power. Unfortunately, for ordinary Algerians, that means another five years of oppression and kleptocracy under the auspices of an increasingly incapacitated autocrat. Dalibor Rohac is a policy analyst at the Center for Global Liberty and Prosperity at the Cato Institute. Nouh El-Harmouzi is a professor of economics at Ibn Toufail University in Kenitra, Morocco, and editor of

Title:Obamacare For Lunch?
Date:Fri, 11 Apr 2014 09:06 EDT
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Description:Patrick J. Michaels Every five years the U.S. Department of Agriculture revises its dietary “guidelines”. These do more than telling us what we should eat. Public schools, the army, and even Congressional cafeterias follow them. New ones will be published next year, created by a fifteen-member panel, the Dietary Guidelines Advisory Committee. “We’re about to be fed a diet of political correctness.” Our federalized food system is a highly politicized beast, manipulated to please as many lobbies as possible. Last year we burned up nearly half of our corn to please the environmental lobby (global warming), the farm lobby (bloated corn prices) and the defense lobby (“energy security”). The only goal that this crazy policy actually achieves is to make food more expensive worldwide. Expect more of the same from this year’s panel. We’re about to be fed a diet of political correctness. While some of the recommendations are likely to be salutary (“eat less”), others may be deadly. Back in the day, the Guidelines recommended a lot of dairy products and meat, in no small part to encourage consumption of our enormous agricultural output in as inefficient a way as possible. Based upon the track records of the new panelists, we can make a few predictions about what it is likely to recommend. Some are, well, pretty cheesy. The panel will urge frequent consumption of foods containing fish oils or their equivalents. Once the darlings of the nutrition-health complex, they don’t seem to show the cardioprotective effects that they were supposed to, judging from heart attack morbidity and mortality data. But their consumption is associated with a 44% increase in the risk of prostate cancer, especially the aggressive ones that kill men. That’s a lot of deaths and misery for no gain whatsoever. (Source: Brasky et al., 2013 Journal of the National Cancer Institute) The panel will recommend limiting the use of salt, because sodium increases blood pressure. That’s soooooo 20th Century! The vast majority of the population is simply insensitive to salt and—attention—restricted salt diets are now known to significantly increase the frequency of heart attacks, probably because of disturbed cardiac rhythms. (Source: Staessen et al., 2011 Journal of the American Medical Association) No deep-fried food please. The breakdown products in overused oils are associated with a very slight increase in prostate cancer frequency—which is dwarfed by the increase that will be caused by the committee’s likely perseveration over fish oils. The committee will recommend a ban of trans (partially hydrogenated) fats from all foods. One of the advisors to the panel, Sonia Angell, was Mayor Bloomberg’s henchperson in the NYC ban, resulting in impalatably soggy donuts and foods with unattractive “mouth feel”. This last one is particularly galling. Yes, trans-fats are associated with elevated triglyceride levels, and those are associated with significant increases in heart attack prevalence. But, as is obvious from the chronic medication almost all male readers over fifty take, the dose makes the poison. An outright ban simply makes life less enjoyable. The panel believes—quite erroneously—that any intake of trans-fat is harmful, the same way the government believes that one photon of ionizing radiation can cause a detectable increase in cancer. The entire regulatory paradigm for carcinogens and radiation is based this “linearity-no dose” threshold. It is simply wrong. Small doses of things that can be harmful in large doses often confer benefits. Think “sunlight”. The panel should be consulting with Ed Calabrese, a toxicologist at University of Massachusetts and a Cato Scholar, rather than Sonia Angell. Calabrese has examined hundreds of compounds and found this relationship in his bajillion peer-reviewed papers. The Bloomberg experience banning large sugared drinks isn’t likely to be repeated. So, rather than having a judge tell the food police that they are out of line, they will instead recommend a tax. California already has one, so why not everyone? And just shove the revenue over to Big Agriculture, as they will complain that depressed corn sugar (fructose) demand will lower corn prices. Easy beans. When Angell came in front of the USDA’s new committee, the Vice-Chair, Tufts University’s Alice Lichtenstein, went ga-ga, introducing Angell as “one of my heroes” because of the trans-fat and sugary drink bans. Angell repeatedly emphasized the need to “change the context to make individuals’ default decisions healthy”. According to Mary Story, another committee member, “context” means pretty much the government gets into everything when it comes to food. Lichtenstein was actually plagiarizing Story, who recently wrote, Our ultimate goals should be to structure neighborhoods, homes, and instutional environments so that healthy behaviors are optimal defaults. That’s right, homes. Yes, we haven’t heard yet exactly what the 2015 Dietary Guidelines Advisory Committee is going to recommend, but the perceptions and emanations from the members’ histories are ominous. Patrick J. Michaels is Director of the Center for the Study of Science at the Cato Institute and a senior fellow in research and economic development at George Mason University.

Title:The Fourth Amendment Shell Game
Date:Thu, 10 Apr 2014 08:56 EDT
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Description:Julian Sanchez The National Security Agency’s controversial call-records dragnet has never been much use at finding terrorists, as two separate government panels have concluded, but technological change has been gradually rendering it completely irrelevant. Now, under the guise of putting an end to that program—which sweeps in the phone logs of millions of innocent Americans for later analysis—President Obama has proposed a new authority that could force private corporations to act as government spies, circumventing constitutional privacy safeguards in the process. The current version of the NSA program is based on a Patriot Act authority that lets the government obtain records already kept by phone companies for their own business purposes. But as Reuters reported last week, the president’s proposal could require carriers to create new records in response to the government’s secret demands. To understand why this would set such a dangerous precedent, it’s necessary to understand the legal theory behind the NSA program as it now exists. “One of Obama’s NSA reforms just makes the problem worse.” If the government wants to seize your cellphone in order to learn whom you’ve been calling, the Fourth Amendment requires a judicial warrant, based on evidence that provides “probable cause” to believe you’re up to no good. But thanks to a 1979 Supreme Court ruling, Smith v. Maryland, it doesn’t need to meet that high standard if it collects the same information from the phone company. When you place a call, the court reasoned in Smith, you “knowingly expose” the number you’re dialing to the phone company—and any customer who ever looked at a phone bill should be well aware that carriers keep records of those numbers, along with the times and durations of calls. In the process, the Smith decision argued, you waive your “reasonable expectation of privacy”—and therefore your Fourth Amendment rights. That “third party doctrine,” as legal scholars have dubbed it, is why the NSA doesn’t need to worry about formalities like “probable cause” or “particularized suspicion” when it vacuums up phone records in bulk. Things have changed since the ’70s, however, and increasingly phone companies aren’t bothering to bill customers by individual calls—which means they may not need to keep all the detailed information NSA wants for billing purposes, at least not in a form that separates it from information NSA is barred from collecting, like location data. Instead, they’re moving to flat-rate billing that more closely resembles the model most Internet providers use, where you pay the same amount regardless of how many websites you visit or where they happen to be located. And, of course, people are moving from landlines to cellphones. As a result of all this, according to press reports, the NSA is no longer getting nearly all Americans’ phone records—because in many cases, cell carriers no longer need to keep detailed records for billing purposes, any more than Comcast needs to keep logs of which YouTube videos you watch in order to send you a monthly bill. Though Obama’s plan only makes reference to telephone companies, it’s already clear that most personal communications—whether text chats or voice calls—will travel over the Internet in the very near future. So it’s no surprise that legislation proposed by leaders of the House intelligence committee takes the obvious next step: It applies to all “electronic communications” providers, a category that encompasses broadband companies like Comcast or Verizon as well as online platforms like Google and Facebook. That’s a much bigger deal, because Internet services have the ability to collect a much wider array of data about their users—and also more potential to provide secure and anonymous communications by choosingnot to collect it. The crucial mandate there is hidden in some innocuous-sounding but ambiguous language requiring companies to “immediately provide the government with records, whether existing or created in the future, in the format specified by the government.” (Italics mine.) That’s fine if it just means companies have to segregate the information NSA needs from the details it doesn’t, or standardize their records for easy cross-referencing. But if the Reuters report is accurate, what intelligence agencies really want is the discretion to tell companies what information they should collect and store—at least when it comes to “suspicious” users and their friends—even if the company has no business reason to keep that data. Your broadband provider may not have any reason to track what sites you read or whom you chat with—and plenty of us would refuse to do business with one that did—but under a broad interpretation of the House language, the government can secretly force them to start doing so without a warrant. That unwisely skews corporate incentives toward broader data retention—even as privacy advocates and security experts alike urge more limited retention to protect users from data breaches. Legal scholars have long criticized the strained logic of the Smith ruling, which assumes we surrender all our constitutional privacy rights in any information we share with a corporation, even under the strictest promises of confidentiality. But this new proposal stretches that logic past the point of absurdity. The only way to square such a power with the Fourth Amendment is to assume that you somehow “waive” your constitutional privacy rights in any data (other than the actual contents of a message) that flows through any corporate computer. On that logic, even if a privacy-friendly online platform pledges not to log who you’re chatting with, for instance, the fact that they could means that information isn’t private for Fourth Amendment purposes after all. Think of it as a legal shell game: When the government orders a phone or Internet company to monitor you, the Fourth Amendment offers no protection, because that’s not a government search. Then when the government seizes the results of that monitoring, you’re still out of luck—because now they’re not taking your records. The courts have already embraced that shell game when it comes to banking records—but at least there, the retention mandate is an explicit part of a federal statute, not determined by secret directives from spy agencies. As Supreme Court Justice Sonia Sotomayor has observed, the “third party doctrine” is already increasingly out of touch with ordinary people’s real expectations of privacy in the Internet era. It’s time to start rolling it back and restore the Fourth Amendment’s teeth—not letting the government decide how much privacy we can expect. Any legislation to reform NSA’s metadata program needs to make crystal clear that it only covers information that companies keep for their own reasons—not information that spy agencies want to exempt from constitutional protection. Julian Sanchez is a research fellow at the Cato Institute.

Title:Is Estonia Worth a War?
Date:Thu, 10 Apr 2014 08:49 EDT
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Description:Justin Logan No one near the levers of power in Washington suggested that Ukraine’s territorial integrity was worth risking a war with Russia. That stark reality offers an opportunity to evaluate U.S. alliances. Which European countries should the United States be willing to go to war with Russia over? It’s an important question, given that Washington has a formal treaty commitment to a number of countries that are less strategically important than Ukraine. Since no one in Washington favored fighting for Ukrainian sovereignty, would they really threaten it over, say, Estonia, just because the latter is a NATO member? Does the existence of an alliance commitment create an interest worth going to war over? “Which European countries should the United States be willing to go to war with Russia over?” Over the second half of the twentieth century, the United States steadily accumulated allies. During the Cold War, we gathered allies in the name of containing the Soviet Union. After the Cold War, Washington parlayed its winnings, expanding its sphere of influence. In Europe, two rounds of NATO expansion brought the anti-Russian alliance up to the Russian border, accompanied by promises that NATO was no longer about Russia. Globally, more than a quarter of the world’s countries are now allies of the United States. The early Cold War rationale was strong. Leaving Germany vulnerable to the Soviet Union risked allowing Moscow to dominate Europe. But that’s not going to happen today, with or without NATO. If Russia annexed all of Ukraine and seamlessly integrated it into the Russian Federation without a hitch—something that’s not going to happen—the Russian economy would be about 14 percent larger, equivalent roughly to that of Italy and Turkey combined. Given that Russia could not threaten Western Europe, or even most of Central Europe, it’s hard to argue that the United States has a similar interest in threatening wars to defend most of its modern-day NATO protectorates. War with Russia would be devastating for the United States, for the country on whose territory such a war would be fought, and for Russia. Allowing a state to be pulled into the Russian sphere of influence would be less costly to U.S. taxpayers and servicemembers—and likely even to citizens of the targeted state itself—than fighting over it. It’s thus tempting to judge that NATO expansion was one giant bluff, but it’s probably more accurate to say that Washington rammed through two rounds of NATO expansion without serious consideration of the costs of defending the new allies. As Columbia’s Richard Betts wrote, “NATO’s ostensible purpose, collective defense, appears to have been barely in the minds of the sponsors of the organization’s enlargement.” During the NATO expansion debates, to question whether the prospective member-states would really be worth fighting a war with Russia over was considered impolite and retrograde. It was Old Thinking. The foreign-policy establishment wants two things from NATO: the ability to retain outsized influence on European defense and foreign policy, and cheap deterrence of Russia. For decades, Washington’s NATO policy seems to have worked, or at least hasn’t failed. EU security cooperation has floundered, and Russia hasn’t militarily threatened any NATO member-state. But the Ukraine crisis raises questions about U.S. interests and the Russian perception of them. The unanimity in Washington that there was no interest in fighting Russia over Ukraine could cause deterrence to fail where Washington has even smaller interests, such as the Baltic states. Putin could easily see that the U.S. interests in one of those countries are smaller than they were in Ukraine and decide to violate their sovereignty in spite of the NATO commitment. Given that no American political leader favored fighting for Ukraine, the only argument for fighting for a NATO member that is even less strategically important would be a sheet of paper. For his part, Anders Fogh Rasmussen, NATO’s hawkish secretary-general, hasn’t batted an eye. In an interview with Foreign Affairs, he insisted that Georgia is still on track to NATO membership, despite two of its provinces being occupied by Russian troops, and claimed he is “100 percent sure” that NATO would invoke Article 5 if Estonia were attacked. As to what it would do after invoking Article 5, though, Rasmussen demurred: Actually, it’s part of our deterrence that you never know which decision we will take. Our potential adversary doesn’t know exactly how NATO will react… ambiguity strengthens the deterrence… One wonders. In particular, it is difficult to see how, absent any alliance commitments, American elites would favor fighting for Talinn but not for Kyiv. If anything, Crimea by itself is at least as strategically valuable as any of the Baltic states. So the argument that the same Washington in which no one suggested fighting Russia over Ukraine would fight it over Estonia seems to rely on the idea that the alliance commitment itself creates an interest worth fighting over. If deterrence were to fail, one could imagine two scenarios that would pull in the United States. The first is via concern over international credibility. A president, or a Congress, may worry about the impact of abandoning an ally on other U.S. commitments from Germany to Japan. This argument wonders, “Who will ever believe us again if we reneged on a commitment to a formal treaty ally?” While intuitively plausible, this theory has been tested and found wanting. Countries tend to evaluate credibility on the basis of power and interests, not past promises. But the fact that Washington would not have to fight for its credibility might not prevent it from doing so anyway. The second way the alliance commitment could entrap Washington also involves credibility, but includes domestic politics. It’s not difficult to imagine that if a White House abandoned its commitment to a particular ally, members of Congress, lobby groups for the threatened state, and pundits up and down the I-95 corridor would be rending their garments and howling about appeasement, to the detriment of the president. In this context, a president could feel pressures on both the international front (from allies worried about the U.S. commitment to them) as well as on the domestic political front. The lesson is not that Washington should have started World War III over Ukraine, but rather that there is danger in littering the globe with alliance commitments in places where there is no interest that warrants war. This is particularly true when those countries seem to have been emboldened by the alliance commitment, and have politics that reflect the NATO commitment better than they reflect the nation’s geography or power position. Eventually one or more of NATO’s bluffs could be called, and a U.S. president could find himself—or herself—threatening war in a context where it has no vital interest, and war was never intended or even seriously considered. Justin Logan is director of foreign policy studies at the Cato Institute.

Title:Former Inmates Learning to Avoid Going Back to Their Cells
Date:Wed, 09 Apr 2014 09:24 EDT
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Description:Nat Hentoff At last, more emphasis — particularly from Attorney General Eric Holder — is being placed on how to reduce the large numbers of inmates in our overflowing prisons. Once released, these people are often re-arrested, and then locked up as criminals again. In a lead editorial last month, The New York Times revealed what many of us didn’t know, that “in 2013, about 30,000 federal prison inmates were released to more than 200 halfway houses around the country. These facilities — where an inmate can serve up to the last year of his or her sentence — are meant to ease the transition back into society by way of employment and housing assistance, drug treatment and other programs that make it less likely an inmate will end up reoffending and returning to prison” (“Halfway Back to Society,” The New York Times, March 30). “Preventing recidivism,” the Times editorial argues, “should, of course, be a central goal of any correctional system.” The problem, though, is that “too many halfway houses are understaffed, poorly supervised and generally ill prepared to do that job, and as a result the men and women who pass through them often leave them no better off.” But the attorney general — long dismissed by many critics, including me, as a mere minion of his dictatorial boss — is actively involved in bringing, of all things, human rights to our prison system. The Times editorial goes on: “On March 24, Attorney General Eric Holder Jr. took a step in the right direction by announcing new requirements for federally financed halfway houses — the most recent example of his aggressive push for reform across the criminal justice system.” Furthermore: “Starting in early 2015, halfway houses must provide more rigorous and standardized cognitive-behavioral treatment for inmates with mental health or substance abuse issues, both of which are rampant in prison populations.” How many congressional and presidential candidates will support this in 2016? In February, I wrote that “the Brennan Center for Justice at New York University School of Law reported on Holder’s ‘great step forward on restoring voting rights’ … the attorney general ‘urged states to restore voting rights to people of past criminal convictions’ ” once they had “ ‘completed probation, parole and paid all fines’ ” (my column, “Obama’s Attorney General Americanized (in Part),”, Feb. 19). And last week, I reported on Holder’s “Smart on Crime” initiative, which he elaborated on during his March testimony before the U.S. Sentencing Commission, insisting “that people convicted of certain low-level, nonviolent federal drug crimes will face sentences appropriate to their individual conduct — rather than stringent mandatory minimums, which will now be applied only to the most serious criminals” (“Attorney General Holder Urges Changes in Federal Sentencing Guidelines to Reserve Harshest Penalties for Most Serious Drug Traffickers,”, March 13). Happily, he acknowledged that “this approach enjoys significant bipartisan support on Capitol Hill, where a number of leaders, including Sens. Patrick Leahy, Dick Durbin and Mike Lee — along with Reps. Bobby Scott and Raul Labrador — have introduced legislation that would give judges more discretion in determining appropriate sentences for those convicted of certain crimes. “By reserving the most severe penalties for dangerous and violent drug traffickers, we can better promote public safety, deterrence and rehabilitation while saving billions of dollars and strengthening communities” and cutting down on recidivism. And now that Holder himself sees the necessary humaneness in preventing formerly incarcerated Americans from becoming permanent outcasts, he is looking ahead: “As my colleagues and I work with Congress to refine and pass this legislation, we are simultaneously moving forward with a range of other reforms.” The no-longer-supine Holder speaks of such programs as “drug treatment initiatives and veterans courts that can serve as alternatives to incarceration in some cases. “We are working to reduce unnecessary collateral consequences for formerly incarcerated individuals seeking to rejoin their communities. And we are building on innovative, data-driven reinvestment strategies that have in many cases been pioneered at the state level.” Gee, the Justice Department is following Louis Brandeis’ advice to pay attention to the individual states for creative innovations to actually bring justice to our prison system. Holder continued: “In recent years, no fewer than 17 states — supported by the department’s Justice Reinvestment Initiative, and led by officials from both parties — have directed significant funding away from prison construction (Wow!) and toward evidence-based programs and services, like supervision and drug treatment, that are proven to reduce recidivism while improving public safety.” And to draw the support of taxpayers increasingly worried about how well their health insurance and pensions will cover them during retirement, Holder cheerily reported that: “Rather than increasing costs, a new report — funded by the Bureau of Justice Assistance — projects that these 17 states will actually save $4.6 billion over a 10-year period.” That’s for starters. I hope that the media in all its forms will learn — as I have from Eric Holder — what ceaselessly inventive jazz master Charlie Parker once told me: “Kid, be careful about first impressions and previous impressions. Get to know that person — and yourself — again, and deeper. You might have missed something important!” Well, I never thought I’d write two columns urging you to look again at the previously mechanical head of the Justice Department — in the shadow of the omnipotent president. But this renewed Eric Holder has shown that he can be his own man — up to this point. There should be more changes from him to come. Nat Hentoff is a nationally renowned authority on the First Amendment and the Bill of Rights. He is a member of the Reporters Committee for Freedom of the Press, and the Cato Institute, where he is a senior fellow.

Date:Wed, 09 Apr 2014 09:03 EDT
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Description:Michael D. Tanner The Obama administration is now entering its second week of celebration over the 7.1 million Americans who signed up for insurance through Obamacare’s exchanges. The administration also claims an additional 8 million Medicaid enrollees and 3 million young people who can now stay on their parents’ policies. Those numbers have been widely debunked, of course — the number of newly insured Americans is probably much closer to 3 to 4 million total. But beyond the debate over top-line numbers, there remains something troubling about the administration’s celebration of “success,” for the Affordable Care Act will dramatically expand Americans’ dependence on government. “Obamacare is a wealth-transfer program with health insurance attached.” Start with those 7.1 million signing up through exchanges. When critics point out that the policies available on the exchanges are often more expensive than many policies sold before Obamacare, ACA advocates point to subsidies that reduce what many enrollees actually pay. In fact, according to the Center for Medicare and Medicaid Services and outside organizations such as the Kaiser Family Foundation, somewhere in the range of 80 percent, and as many as 83 percent, of those enrolling received a subsidy to help pay for their insurance. That could amount to some 5 to 5.5 million people, depending on how many of those who selected plans actually pay premiums. And it’s not as though those subsidies are going only to the poor, who otherwise could not afford insurance. Although more generous to those earning 250 percent of the poverty line ($58,875 for a family of four), some level of subsidy is available up to 400 percent of poverty ($94,200 for a family of four). In fact, taking into account various income disregards, some families with even higher incomes could receive a subsidy. The Congressional Budget Office estimates that as many as 700,000 people with incomes more than three times the poverty level will receive a subsidy next year. Subsidies, of course, do not actually reduce the cost of those insurance plans, but simply shift part of that cost from the purchaser to taxpayers. Moreover, since the Rand Corporation estimates that it’s possible as few as 858,000 enrollees were previously uninsured, millions of Americans who were paying for their own insurance have now moved onto the government dole. While it would generally be unfair to blame people for taking advantage of what is being offered to them, especially when Obamacare may have forced them out of their previous policies involuntarily, it doesn’t change the reality on the ground. The number of Americans dependent on government transfers will increase. Obamacare’s Medicaid expansion represents an even more obvious enlargement of the welfare state. Using CMS figures for enrollment through March 1 and extrapolating for enrollment last month, it is likely that only 3 to 4 million of the projected 8 million Medicaid enrollees are new signups. (The others are part of the normal churn within the Medicaid program.) Even so, this represents a 5.2 percent increase in the number of Americans on Medicaid. In some states, such as West Virginia, Vermont, and Massachusetts, more than one out of every five people will be receiving Medicaid. The evidence suggests that at least some of those new Medicaid recipients had private insurance before, but either were dumped by their employers or chose to go on “free” insurance. The Robert Wood Johnson Foundation, long a supporter of Medicaid, has amply documented this “crowd-out effect,” concluding that in some cases, loss of private insurance could completely offset the increased gains from Medicaid expansion. And a study for the National Bureau of Economic Research, one of whose authors was Jonathan Gruber of MIT, an architect of Obamacare, found that from 1996 to 2002, for every 100 children who received coverage through Medicaid or SCHIP, 60 lost private insurance. This is bad news not just for taxpayers but for the recipients themselves, since they are trading down to an inferior insurance plan. No one knows yet how many Obamacare Medicaid recipients dropped private coverage as a result of the ACA, but some data suggest that it could be quite high. For example, a study for the Veterans Administration found that as many as 82 percent of working adults who enroll in Medicaid under Obamacare will have had private insurance. They are simply moving from good insurance that they had to pay for to lousy insurance paid for by someone else. Obamacare, then, is less a health-insurance program than a gigantic wealth transfer. Even before Obamacare, the American welfare state was threatening to swallow up more and more of us. In 1965, just 22 percent of all federal spending was transfer payments. Today the figure has doubled to 44 percent. In 1965, transfer payments from the federal government were equivalent to less than 10 percent of wages and salaries. As recently as 2000, that percentage was just 21 percent. Today transfer payments are almost 35 percent of salaries and wages. If one counts government employees and contractors as well as recipients of government programs, more than half of Americans receive at least half of their income from the government. Government dependency is not a good thing. Obviously, it’s bad for taxpayers and economic growth when the welfare state becomes ever more unaffordable. As Margaret Thatcher reputedly said, “Eventually you run out of other people’s money.” But it is also bad for those who are trapped in a system that makes it harder for them to achieve and become all they might be. Obamacare will make this worse. And that’s nothing to celebrate. Michael Tanner is a senior fellow at the Cato Institute and the author of Leviathan on the Right: How Big-Government Conservatism Brought Down the Republican Revolution.

Title:Republican Leaders Should Be Consistent on 'Imperial Presidency'
Date:Tue, 08 Apr 2014 09:26 EDT
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Description:Gene Healy “‘Imperial Presidency’ Becomes a Rallying Cry for Republicans,” the New York Times headline blared in a story in the April 1 print edition. But the Grey Lady wasn’t fooling: it’s the GOP’s “unified anthem” for 2014, reflecting “conservative philosophy about the appropriate role of government.” “On core Imperial Presidency concerns, the GOP rank-and-file are better than their leadership, but they could use a better standard bearer.” House Majority Leader Eric Cantor, R-Va., is leading the charge. In March, he released an updated white paper on “The Imperial Presidency,” and helped shepherd the adroitly acronymed ENFORCE the Law Act (for “Executive Needs to Faithfully Observe and Respect Congressional Enactments”) through the House. The bill, which tries to compel the courts to rule on issues like the president’s repeated flouting of Obamacare deadlines, was necessary, Cantor insisted, because “the president’s dangerous search for expanded power appears to be endless.” I’ve long argued that the Right should rediscover its historic skepticism toward executive power, so the Republicans’ new tune should be music to my ears. But while it’s got a nice beat, I’m not sure I can dance to it. For one thing, the GOP’s latest legislative nostrum won’t force President Obama to care about his duty to “take Care that the Laws be faithfully executed.” As the Cantor report describes it, the ENFORCE the Law Act “mandates that the courts set aside their own court-created standing rules and … prevents courts from using procedural excuses” to avoid “important separation of powers cases.” In other words, it subverts separation of powers principles in an attempt to enforce them. The courts are unlikely to comply. What’s more, the Cantor Report mixes legitimate concerns with bogus and trivial ones: It condemns the administration’s “extraordinary step” of refusing to defend the Defense of Marriage Act in the courts and “leaving that job to Congress.” There’s nothing especially “extraordinary” about that; President George H.W. Bush and President Clinton, among others, refused on occasion to defend statutes they considered unconstitutional, something the presidential oath arguably requires. Also among the president’s imperial sins, per the report: Obama “refused to abide by a statute requiring his State Department “to record ‘Israel’ as the place of birth on passports for U.S. citizens born in Jerusalem.” Cantor fails to mention that it was President George W. Bush who first refused to abide by that requirement — correctly, according to the U.S. Circuit Court of Appeals for the D.C. Circuit, which struck it down last year. The GOP’s latter-day anti-imperialists are absolutely right that Obama’s “royal dispensations” in the areas of health care and immigration undermine the rule of law. Still, surely his administration has provided more terrifying examples of executive unilateralism than the refusal to deport otherwise law-abiding people whose parents brought them here as children and the decision to delay the implementation of a scheme the GOP’s denounced as socialism. In his imperial parade of horribles, Cantor finds room for “withholding critical information about counterfeit goods”—but says nothing about major executive power abuses like illegal wars and dragnet domestic surveillance. There’s a reason for that. Rep. Cantor, truth be told, is rather sweet on the Imperial Presidency. As he sees it, the problem with Obama’s Libyan war wasn’t its lack of congressional authorization—it was that the president wasn’t aggressive enough. Cantor’s for a more aggressive approach to Syria, a more aggressive approach to Iran—a more aggressive approach to aggression. He’s even given to quoting President Lyndon Baines Johnson’s foreign policy wisdom. And when Rep. Justin Amash, R-Mich., moved to defund the National Security Agency’s bulk collection of innocent Americans’ calling records, Cantor threatened to kill the bill on a procedural technicality. Ninety-four House Republicans later voted to end the program; Cantor wasn’t among them. On these core Imperial Presidency concerns, the GOP rank-and-file are better than their leadership. They could use a better standard bearer. Gene Healy, a Washington Examiner columnist, is vice president at the Cato Institute and author of The Cult of the Presidency.

Title:What Education Reformers Can Learn from Kosher Certification
Date:Mon, 07 Apr 2014 10:08 EDT
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Description:Jason Bedrick Can we have standards without the government imposing them? Writing in Education Week, school reform champion Robert Pondiscio recently offered a thoughtful and thought-provoking critique of the open letter on educational choice and accountability issued by scholars at the Cato Institute, the Heritage Foundation, the Friedman Foundation for Educational Choice, the Heartland Institute, and the Center for Education Reform. The letter made the case that where parents are able to choose their children’s schools, uniform, government-imposed standards and tests are both unnecessary (because the schools are directly accountable to parents who have the option to leave) and counter-productive (because a uniform standard stifles diversity and innovation). Pondiscio generally favors educational choice, agreeing that “markets have proven more effective than mandates in improving outcomes for low-income children.” Indeed, the international evidence suggests that more market-like education systems outperform those that are more centralized and regulated. However, Pondiscio expresses a common concern about an education system lacking any standards: I have insisted I’m invested only in outcomes, not systems, so I should simply favor what seems likely to achieve the best results for the most kids. But I find myself reluctant to advocate for a standards-less system. [emphasis added] Look, I want kids to learn how to read. As I quipped to Andrew [Coulson of the Cato Institute], I don’t want to be the one to say, “Too bad, kid. Your parents chose badly. I’ll tell you how the free market works as soon as you’re done cutting my lawn.” This concern is understandable but misplaced. The lack of a government-imposed standard does not imply the lack of any standards. Rather, it leaves space for competing standards. One market-based method of providing standards is through private certification, like Underwriters Laboratories or Good Housekeeping. An instructive example of this is private kosher certification. “Market forces create incentives that give private certification numerous advantages over government-imposed accountability regimes.” A Brief Recent History of Kosher Certification As with education, there is information asymmetry between providers and consumers. Providers know much more about the quality (or kashrut) of their products than consumers, who must therefore rely on trust or some sort of regulation or certification. Old World kosher certification was highly-centralized in each community and often backed by the government, but when Jews immigrated to America en masse, they found that such a system was unworkable in a land of free markets, mass production, and religious liberty. During the 19th and early 20th centuries in America, it’s likely that half or more of the meat sold as “kosher” was actually non-kosher. The Jewish community in New York turned to the government to solve this problem, and the state responded by creating the New York State Kosher Enforcement Bureau. However, by the 1930s, the Bureau proved unable to properly oversee the roughly 18,000 kosher food establishments under its jurisdiction. Moreover, arguments erupted between numerous Jewish factions over how the state agency should interpret kosher law or whether it should be in the business of interpreting Jewish law at all. What emerged to fill this void was a system of private certification that has lasted until today. In 1924, the Union of Orthodox Rabbis created the first private kosher certifying agency in America, followed by the OK Laboratories in 1935. Kosher laws can be quite arcane and, as noted earlier, there are differences of opinion at the margins. Some private kosher certifying agencies accept certain leniencies that others reject while some adopt certain stringencies that others find unnecessary. Kosher consumers are free to decide which certifiers meet their level of religious observance and which do not. There are now more than 1,100 private kosher certifying agencies worldwide, including more than 300 in the United States, and the segment of the food industry that is certified kosher is valued at about $13 billion. Consumers seeking kosher products can now find them in every major grocery store in the country. Why Private Certification Works In his book, Kosher: Private Regulation in the Age of Industrial Food, Professor Timothy Lytton finds that the system of private kosher certification is highly reliable. For example: Of the half-million products that the Orthodox Union (OU)—the nation’s largest kosher agency—certifies each year, its legal department investigates only about five hundred cases of questionable use of its kosher symbol, and it takes action in only fifty of those cases. … Moreover, when mistakes are discovered, private kosher certification agencies routinely issue consumer alerts and product recalls, at significant cost to themselves and their food-company clients. Lytton identifies five reasons why the private system of kosher certification is so reliable: consumer demand, brand competition, interdependence, concentration of market power, and vigilant consumers. With the right policies, these dynamics could foster a system of private certification in a robust market for education as well. First, sufficient consumer demand for kosher certification gives food manufacturers incentive to pay for reliable, independent inspection of their production facilities. Consumers seek the assurance provided by kosher certification and companies that fail to obtain certification risk losing market share. There is much greater demand for quality education than there is for kosher products. However, because the government provides schools that are free of charge, most private options are crowded out. That prevents a true market in education from developing and flourishing, thereby reducing the demand for private certification. Government accountability schemes further crowd out private certifiers. Nevertheless, educational choice programs of sufficient size could mitigate the crowd-out effect and foster healthy competition among schools. Given the information asymmetry between education providers and parents, schools that obtained certification from trusted independent agencies would then have a comparative advantage. That would spur greater demand for certification and would likely induce more certifying agencies to enter the market. Second, brand competition among certifiers based on reliability has led to increasing expertise and accountability. Efforts to build brand value in response to competition have led kosher certification agencies to provide professional training for their personnel in Jewish law as well as food chemistry and technology and to impose strict ethical codes. Agencies have also instituted new forms of quality control that include multiple layers of oversight and improved information management. Brand sensitivity has produced a culture of prompt and thorough responses to consumer complaints. There is a legitimate diversity of views about what constitutes a quality education. In the absence of government crowd-out, is likely that competing brands of certifying agencies would reflect this diversity. Certifiers would be at liberty to take various approaches to measuring the skills and/or content knowledge that schools impart. Certification agencies that proved their worth to parents—especially those that earned the trust of colleges or employers—would be in greater demand and therefore sought after by schools seeking to attract those parents. Indeed, there are already independent agencies certifying individuals in niche markets, such as computer software engineering. Third, interdependence among certifiers gives rise to additional oversight. The value of an agency’s kosher certification of a food ingredient—for example, vanilla extract—depends on its acceptability to other agencies certifying products that include the ingredient downstream in the production process—for example, ice cream or cookies. This means that upstream certifiers must meet standards set by downstream certifiers… Since agencies typically certify different products at different stages of the production process, they operate both upstream and downstream relative to each other, creating a network of interagency oversight. Since students often change schools, particularly when entering high school, it is likely that there would be upstream and downstream interdependence among certifiers. Just as high schools want to prove their value to colleges, primary schools want to prove their value to high schools. Downstream providers would want to ensure that upstream providers are sufficiently preparing students so they would have an incentive hold upstream certifiers accountable for accurately assessing the quality of the upstream providers. Agencies that certified K-12 would therefore operate both upstream and downstream relative to each other. That would likely foster interdependence among agencies and could even spur the creation of one or more umbrella organizations. This interdependence is likely to be even more pronounced in the digital age when students can tailor their education utilizing multiple education providers in a single year or even for a single subject. Fourth, concentration of market power in the hands of a few large certifiers makes it easier to coordinate the development and enforcement of industry standards… Any agency that fails to conform to these standards risks losing accounts to competitors. It’s impossible to predict how a new market would develop, but the experience of other sectors suggest that a relatively small number of nationally-trusted certifiers would emerge over time while leaving room for numerous regional or niche certifiers. Fifth, a corps of active and vigilant consumers provides additional oversight, gives certifiers quality-control feedback, and puts teeth in reputational sanctions… Since certification agencies’ brand value depends upon their reputation among vigilant consumers, agencies have a strong incentive to avoid mistakes and misconduct, and to report them promptly when they occur. There already exists a large corps of active and vigilant parents who would provide the additional oversight and offer the necessary feedback to certifiers. A recent study by the Friedman Foundation for Educational Choice found that solid majorities of parents—including low-income parents—are willing and able to take multiple steps to seek out desired information before making a decision about their children’s schooling. Two-thirds reported that they would review the information available on the internet. Advantages of Private Certification Over Government Standards Private certification could have several advantages over government accountability regimes in a competitive market. For example, private certifiers are likely to be more efficient and more responsive to parents. In addition, the incentives they face are likely to produce standards that are higher yet more comprehensive and diverse. Efficiency & Responsiveness The wheels of government turn slowly. Modifying existing standards often requires legislative action in a system that is designed to be slow and deliberative with numerous veto points. Even then, implementing the change requires further actions from large bureaucracies that are often invested in the status quo and may be hostile toward the reform. Moreover, when a school fails to meet established standards, the sanctions they face rarely induce meaningful change. While private certifiers have considerably less power than state and local governments, withdrawing certification could still have a more effective and immediate impact if that induces parents to withdraw their students and their funds. Financial losses are the market’s way of signaling that significant changes are needed right away. In a competitive market, a low-performing organization must either improve or close down. Higher Standards Government accountability regimes face great political pressure from educrats and union officials to lower standards but little countervailing pressure to maintain high standards. Those with the most to lose from enforcing higher standards are better informed and more organized than parents and others who support them. By contrast, far from producing no standards, a robust market is actually more likely to produce higher standards. The most important asset that private certifiers have is their reputation. While certifiers would face financial pressure to lower their standards in order to certify more schools, doing so would water down their brand. That would weaken the market signal that their certification provides, thereby reducing demand for their service and possibly jeopardizing their very existence. More Comprehensive Standards One component of the “teach-to-the-test” complaint is that state tests induce schools to divert resources to the subjects that are tested at the expense of other subjects. However, education experts and parents alike recognize that there is much more to education than just math and language arts, as important as those subjects are. Given the market demand for information about other aspects of education that schools provide, schools that could demonstrate high performance in those areas would have a competitive advantage. That could mean either a single certification from a comprehensive certifier or possibly multiple certifications from niche certifiers. These certifiers would have the flexibility to measure performance using means other than test scores or inputs like seat time. More Diverse Standards Government standards tend to be uniform. No two children are exactly alike yet top-down government mandates by their very nature expect all children born in the same year to move at the same pace across all tested subjects. Moreover, by choosing a single standard when there is a legitimate diversity of views, the government induces strife.  When the government decided what was and was not kosher, Jews with a different understanding of the kosher laws were justifiably upset and some even sued. Likewise, some parents are not happy with the Common Core standards that nearly every state has adopted. A system of private certification would make room for competing views of what constitutes a quality education. A Market Solution No system built from the crooked timber of humanity will be perfect. In other sectors, private certifiers have sometimes proven unreliable or incompetent. However, the relevant comparison is not a utopian ideal but the far-from-utopian status quo and other feasible alternatives. As the case of kosher certification demonstrates, market forces create incentives that give private certification numerous advantages over government-imposed accountability regimes. They are likely to be more efficient and to produce better, more comprehensive, and more diverse standards. Eliminating a single government-imposed standard is unlikely to result in the lack of any standards. Rather than anarchy, the market fosters a spontaneous order that is the product of human action, but not of human design. Jason Bedrick is an education-policy analyst at the Cato Institute’s Center for Educational Freedom.

Title:Why Do We Still Use Paper Money?
Date:Mon, 07 Apr 2014 09:33 EDT
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Description:Richard W. Rahn Paper currency is dirty and is a major transmitter of disease as it goes from unwashed hand to unwashed hand. It is easily lost and stolen, and can be easily destroyed by getting wet or burned. It physically wears out in a short time and is costly and troublesome to replace. So why do we still use the filthy stuff in the electronic age? When given a choice, people find credit cards, debit cards and bank account electronic payments more convenient than cash. In many parts of the world, payments can be made from cellphone to cellphone, with the phone companies serving many of the functions of traditional banks. Money can be stored and transmitted from and to almost any form of computer. Also various forms of electronic money can be made more secure than paper currency. Electronic monies and payment systems do not spread disease. “Easily stolen, filthy currency ought to be forsaken.” Governments like electronic money payment systems that they can monitor, such as credit cards, but they don’t like nongovernment created electronic monies and payment systems that they find difficult to monitor like bitcoin. So, predictably, last week the IRS ruled that bitcoin is not money, thus the users must report the capital gain and loss against the U.S. dollar for each transaction made with bitcoins. Even with advanced software, an individual who might use bitcoins for the purchase of many goods and services will find trying to comply with the IRS an accounting nightmare. Some 15 years ago, I wrote a book forecasting the demise of paper currency. I expected paper currency to gradually disappear like paper checks have. However, I was wrong. Rather than disappearing, the demand for paper currency is rising faster than inflation or population, albeit not by much, but the total quantity of paper U.S. dollars in circulation is roughly double what it was a dozen years ago. The question is: Why? One reason given for the decline in street crime is that individuals and small merchants tend to carry less paper cash on their person as they rely more and more on the various forms of electronic payment systems — thus reducing the supply of easy-to-steal paper currency by petty criminals. Yet, at the same time, paper-currency balances per person are rising rapidly, which means that most people are keeping larger and larger cash hoards at their homes or offices, or elsewhere. Despite its considerable drawbacks, paper currency has a couple of very important advantages over other forms of money. It is anonymous — meaning you can keep your spending confidential — which almost all people like to do at times, both for good and bad reasons. Most electronic money must be held by a third-party custodian — such as a bank, merchant, or cellphone company, and hence is easily liable to seizure by government agencies or other electronically sophisticated miscreants. In an age where the IRS and various other government agencies have “asset-forfeiture” powers, they can seize bank accounts before one is convicted of any wrongdoing. Therefore, people have a real and justified fear of having all of their cash in the bank. The global anti-money laundering police with their ever increasing “know-your-customer regulations” have made it much more expensive for banks and other financial institutions to provide basic financial services, such as checking and savings accounts. As the costs of servicing each account rises because of government regulations, banks understandably require larger and larger minimum balances and more and more documentation from each customer, all of which causes a reduction in the number of potential customers who meet the new requirements. Those who cannot meet the new requirements (most often, the young and the poor) go unbanked. Without a bank account, people cannot get credit cards. Obtaining airline tickets, hotel rooms, auto rentals, etc., is most difficult for those who do not have bank accounts and bank-issued credit cards. By necessity, those without bank accounts are driven into the cash economy, where their paper currency is hard to protect and often stolen. Politicians and regulators love to grandstand about how their regulations are preventing tax evasion, money laundering, drug dealing and terrorist finance. In fact, many studies show that most of the regulations are ineffective and only serve to benefit those who write the regulations, compliance officers in financial firms, lawyers, accountants and, of course, the politicians who extort campaign contributions from those who are regulated. The truth of the matter is that those who come up with the regulations are responsible for more diseases being spread (from paper currency), more people being robbed, higher costs and fewer services for everyone who uses financial services, and a more difficult and dangerous life for the poor and the young. The rise in the use of paper currencies is a direct result of overly intrusive and abusive government. If governments were benevolent and respected individual property and privacy, most paper currency would disappear — and that would be all to the good. Richard Rahn is a senior fellow at the Cato Institute and chairman of the Institute for Global Economic Growth.

Title:Washington Should Not Defend Ukraine or Expand NATO: U.S. Should Shift Responsibility For Europe's Defense to Europe
Date:Mon, 07 Apr 2014 09:12 EDT
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Description:Doug Bandow Russia’s brazen annexation of Crimea has generated a flood of proposals to reinvigorate and expand NATO. Doing so would make America less secure. Until World War II the U.S. avoided what George Washington termed “entangling alliances.” America generally defended itself by avoiding old world conflicts. The U.S. changed course in World War II and the Cold War, fearing that hostile powers would dominate Eurasia. Protecting important embattled states preserved international space for America. The collapse of communism eliminated the prospect of another country controlling large swaths of Europe and Asia. The threat to “Old Europe” dissipated and Washington’s allies were capable of dealing with whatever dangers remained. The liberation of “New Europe” was welcome, but the former Soviet allies were not important to U.S. security. However, American policymakers turned the nation’s alliances into ends rather than means, seeking new purposes for old organizations. NATO joined the European Union in linking former communist states to the West. Militarily the alliance focused on “out-of-area” activities, entering conflicts which did not seriously threaten any members. “Washington should not today court war with Russia—a defensive, paranoid nuclear power.” Admitting former Warsaw Pact states also dramatically transformed the alliance, expanding it into a region highly sensitive to Russia. During the Cold War the U.S. and Western Europeans sought to prevent Soviet expansion but made no attempt to roll back Moscow’s control over Central and Eastern Europe. The fall of the Berlin Wall and collapse of the Soviet Union made these nations even less important militarily. There was no security reason for the U.S. to risk war to protect countries long dominated by Moscow. Worse, the seeds of future conflict germinated in many of these nations. With the end of the Cold War’s ideological contest, Moscow had no obvious conflicts with its traditional western adversaries. In contrast, its former allies shared borders, hosted ethnic Russian minorities, interpreted historical experiences differently, and directly impacted Russian security. When European nations demobilized after the disappearance of their one serious threat, the principal burden of integrating and defending the new members fell on America. Yet Washington waved a dozen new applicants through, treating alliance memberships as candies to be put on guest pillows by hotel staff at night. NATO even committed to include Georgia and Ukraine. However, America’s European partners proved wary of inducting these two countries, which had significant political problems at home and more serious potential conflicts with Moscow. Hence, NATO was saved from the legal obligation to intervene during Tbilisi’s 2008 war with Russia. Yet the invasion of Crimea has triggered a cascade of demands that the alliance, mostly meaning America, do something. In March the administration undertook what Secretary of State John Kerry termed “concrete steps to reassure our NATO allies.” President Barack Obama detailed: “Today NATO planes patrol the skies over the Baltics, and we’ve reinforced our presence in Poland, and we’re prepared to do more.” The U.S. added six F-15Cs to Lithuania and a dozen F-16s and 300 troops to Poland, made plans to involve more forces in exercises and training in Poland and the Baltic States, and increased intelligence flights over Poland and Romania. At its March meeting NATO ordered the study of measures to bolster the alliance’s Eastern European members, including adding troops and equipment on station, holding additional military exercises, improving the rapid-deployment force, and reviewing military plans. Alliance commander Gen. Philip Breedlove said options for this “reassurance package” included augmenting airpower, increasing ships in the Baltic Sea, establishing a naval force in the Black Sea, and deploying a 4,500 member combat brigade from Texas to Europe. In early April the Pentagon said it would send an American warship to the Black Sea in “direct response to the circumstances in Ukraine.” The Eastern Europeans desire even more. Polish Defense Minister Tomasz Siemoniak insisted: “The U.S. must increase its presence in [Central and Eastern] Europe, also in Poland.” Romania’s President Traian Basescu cited “the need to reposition NATO’s military resources,” meaning into Romania. Estonia’s NATO ambassador, Lauri Lepik, said “What the Baltic States want is an allied presence in the form of boots on the ground.” An unnamed former Latvian minister told the Economist: “We would like to see a few American squadrons here, boots on the round, maybe even an aircraft carrier.” A gaggle of American policy advocates joined this Greek Chorus. For instance, defense analyst Steven Metz wanted the U.S. to “reverse its withdrawal from Europe and redeploy some forces, particularly in NATO’s eastern areas. An increased ground and air presence in the Baltic republics, Poland, Bulgaria and Romania could help steel the resolve of nations facing Russian intimidation. Greater naval activity in the Black and Baltic Seas would help as well.” The Washington Post urged “more forward deployments in front-line states such as Poland, Estonia and Latvia.” Andrew Michta of Rhodes College argued that “The U.S. needs to expand its presence on the ground in Central Europe.” In particular, “The Obama administration should move ground assets to Poland—preferably a brigade-size force to strengthen near-term deterrence.” John Deni of the U.S. Army War College suggested refashioning temporary facilities in Bulgaria and Romania used for exercises and training “into a permanent one with U.S. forces deployed from Italy, Germany, or even the United States.” Kurt Volker of the McCain Institute would issue “an iron-clad statement articulating the absolute commitment of the alliance to defend the territory of all NATO member states,” update defense plans for all alliance members, and “strengthen air defense assets deployed to the Baltic States.” At least the foregoing countries are all NATO members. Secretary-General Anders Fogh Rasmussen said the alliance would “intensify our military cooperation with Ukraine,” including assisting in modernizing its military. Washington announced that it would be heading annual military exercises in July in Ukraine, which would “promote regional stability and security, strengthen partnership capacity and foster trust while improving interoperability between the land forces of Ukraine, and NATO and partner nations.” Ukraine’s ambassador to NATO, Ihor Dolhov, said “Very active consultations are going on,” with an experts delegation due in Kiev to assess Ukraine’s military needs. Rep. Mike Rogers (R-Mich.) proposed providing Ukraine with small arms. Zbigniew Brzezinski advocated “immediate and direct aid so as to enhance” the Ukrainian military’s “defensive capabilities.” Ian Brzezinski of the Atlantic Council urged NATO or the U.S. alone to arm Kiev with “anti-tank and anti-aircraft weapons.” Moreover, “the alliance or a U.S.-led coalition should back that assistance with the deployment of intelligence and surveillance capabilities and military trainers to Ukraine.” Similarly, Volker suggested selling military equipment to Ukraine financed by loan guarantees, providing military advisors and trainers, and expanding intelligence sharing. Leslie Gelb proposed helping “prepare Ukraine for guerrilla war against an invading Russian force.” Steven Metz proposed doing the same for other non-NATO members as well. A number of analysts would make Ukraine an ally in everything but name. For instance, Volker advocated conducting ground military exercises in “territory bordering Ukraine.” Moreover, he wrote, the alliance should “Determine that any further assaults on Ukraine’s territorial integrity beyond Crimea represent a direct threat to NATO security and, accordingly, issue a statement saying that any such efforts to break off more territory will be met with a NATO response.” Charles Krauthammer suggested creating “a thin tripwire of NATO trainer/advisers” to “establish a ring of protection at least around the core of western Ukraine.” AEI’s Thomas Donnelly proposed “putting one brigade astride each of the two main roads—and there are only two—that connect Crimea to the Ukrainian mainland,” with the forces “backed by U.S. aircraft and partnered with NATO and Ukrainian units.” Robert Spalding of the Council on Foreign Relations advocated deploying F-22 fighters along “with an American promise to defend Ukrainian skies from attack.” Leslie Gelb similarly urged sending “50 or 60 of the incredibly potent F-22s to Poland plus Patriot batteries and appropriate ground support and protection” which could be used to “smash the far inferior Russian air force and then punish Russian armies invading eastern Ukraine or elsewhere in the region.” Finally, there were ubiquitous proposals to expand the alliance. Senators John McCain and Lindsey Graham advocated increasing “cooperation with, and support for, Ukraine, Georgia, Moldova, and other non-NATO partners.” Former Defense Secretary Robert Gates called for making association agreements with Georgia, Moldova, and Ukraine. John Bolton suggested putting “both Georgia and Ukraine on a clear path to NATO membership.” McCain and Graham urged expanding NATO to Georgia and Moldova. The Foreign Policy Initiative put together a neoconservative all-star list of 56 advocating a Membership Action Plan for Georgia and membership for Finland, Sweden, Ukraine, “and other European security partners.” A group of 40 congressmen called for admitting Macedonia and Montenegro, eventually including Kosovo, advancing “the membership prospects of Georgia and Bosnia-Herzegovina,” and continuing “close partnerships … with other countries in Central and Eastern Europe which seek closer relations with the U.S. and NATO.” Finally, more must be spent on the military. For example, Estonian president Toomas Hendrik Ilves argued: “Maintaining 2 percent of GDP for defense must become a major benchmark of allies’ commitment. U.S. officials long have said the same. Last month President Obama declared: “every NATO member state must step up and carry its share of the burden.” In practice, however, NATO always has stood for North America and The Others. The Europeans continue to enjoy a cheap if not quite free ride on the U.S., and have no reason to change so long as Washington showers them with reassurances while guaranteeing their security. Although Ilan Berman of the American Foreign Policy Council complained that “The past half-decade has seen the U.S. defense budget fall victim to the budgetary axe,” America’s military spending is up 37 percent over the last two decades while collective expenditures by NATO’s other 27 members are down by 3.4 percent. Overall the Europeans spend 1.6 percent of GDP on the military and all but four of NATO’s 27 other members spend less than official guideline of two percent of GDP. None match America’s 4.4 percent. Today even the bigger European states don’t spend much and most NATO members continue to cut outlays. Noted the Wall Street Journal: “European powers in recent years have shelved entire divisions and weapons systems. The British Royal Navy doesn’t operate a proper aircraft carrier. The Netherlands in 2012 disbanded its heavy-armor division, and France and the U.K. each now field a mere 200 main battle tanks. France has cut its order of Rafale combat jets to six a year from 11.” The Eastern Europeans, with the exception of Poland, have been reducing their defense outlays as well. The only European nation which spends less on its military than Latvia and Lithuania is Luxembourg. After the annexation of Crimea, the former two, which respectively devote .9 and .8 percent of GDP to defense, announced plans to increase outlays. Latvia hopes to meet the two percent target by 2020. Lithuania’s plans would do so in 2025 or 2026. Still, despite Europe’s anemic military efforts, its capabilities far outrange Russia’s reach. In 2012 the other 27 NATO members spent $319 billion on their militaries, compared to $91 billion by Moscow. With a collective GDP more than eight times that of Russia, the Europeans could do far more if they desired. Moscow can beat up on its weak neighbors, not conquer the continent. The bizarre status quo persists because many Americans simply stopped viewing alliances as serious commitments. In expanding NATO, noted Stephen Walt, people didn’t “ask whether they were really willing to send their sons and daughters to die to protect these new but distant partners. Instead, president after president simply assumed the pledges they were making would never have to be honored.” An American threat to go to war is supposed to deter. But history is replete with alliances that failed to prevent conflict. And when deterrence failed, the military pacts became transmission belts of war. In World War II Germany attacked Poland even though both France and Great Britain guaranteed the latter’s security. The opposing Triple Entente and Triple Alliance failed to prevent World War I from occurring. The Peloponnesian War featured contending Greek blocs. Various opposing confederations did not constrain Rome. The First Punic War between Rome and Carthage grew out of conflict among allies. The Thirty Years’ War featured competing groups. Alliances did not prevent the Anglo-Dutch wars or curb French King Louis XIV’s aggressive empire-building. A kaleidoscope of constantly changing coalitions fought during the 18th century and in the Napoleonic wars. In fact, alliances can encourage confrontation by emboldening weaker, sometimes irresponsible partners. In 2008 Georgia appeared to believe that Washington would back it against Russia. Offering military support to Ukraine could have a similar effect. That would prove especially dangerous in a region that will always remain more important to Russia than to America. In the end, the U.S. could find itself practically alone fighting a war with a nuclear power over minimal geopolitical stakes. Washington should bar further NATO expansion, whether de jure or de facto. Over the longer term America should turn responsibility for Europe’s defense back to Europe. Irish journalist Constantin Gurdgiev complained that “Europeans can’t afford” to take over NATO and their own defense: “Imagine the public debt levels [the] EU would have to run.” But that spending is even less affordable for the U.S., which possesses a smaller GDP, is committed militarily around the globe, and has less at stake in Europe’s freedom than does Europe. Americans should sympathize with the Ukrainian people, who have been ill-served by their own government as well as victimized by Moscow. But that does not warrant extending military support or security guarantees to Kiev. Doing so would defeat the original purpose of NATO: enhancing U.S. security. America went through the entire Cold War without the conflict with Moscow turning hot. Washington should not today court war with Russia—a defensive, paranoid nuclear power. Even a small risk of trading Washington for Kiev is too much. Today Washington can most effectively maintain the peace outside of the transatlantic alliance. Doug Bandow is a senior fellow at the Cato Institute.

Title:Mozilla's CEO Showed the Cost of Disclosure Laws by Crossing the Satan-Scherbatsky Line
Date:Mon, 07 Apr 2014 09:05 EDT
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Description:Ilya Shapiro The policy lesson from the case of Mozilla’s Brendan Eich, who was forced out as CEO of the tech giant he co-founded as a result of his support for Proposition 8—California’s ballot initiative that defined marriage as the union of a man and a woman—has nothing to do with either gay rights or tolerance for unpopular viewpoints. Instead, this episode showed the very real costs that donation-disclosure requirements inflict on civil society. “Election laws exist so that the governed can monitor the government, not the other way around.” That is, the only reason Eich resigned is because his $1,000 contribution to the Prop 8 campaign became public. Or rather he was outed, so to speak, by activists—whom liberal satirist Bill Maher called the “gay mafia”—who scour the publicly accessible donor database in search of high-profile targets with “incorrect” views. Eich is only the most recent victim of such targeting, but he’s unlikely to be the last. Even low-profile Prop 8 supporters—ones who didn’t create the JavaScript programming language or head major companies—have been subject to intimidation, vandalism, and other personal and financial hardships. All committed by individuals complaining about intolerance and demanding acceptance of diverse lifestyles. I point all this out as someone who supports marriage equality and recognizes that there may have been a valid business reason for Mozilla’s board to demand Eich’s resignation once his views became known. Just as business owners ought not be forced to provide services to a same-sex wedding, a private company can have whatever litmus tests it likes. The issue isn’t equality under the law or First Amendment rights—there’s no government action or coercion here—but haggling over what kind of personal opinions disqualify a CEO. Surely we can all agree that a neo-Nazi Holocaust denier—or a Klan member, or a Stalinist, or a Satan worshipper—can’t run a large company. The trust won’t be there, either internally or externally. On the other hand, most people seem not to have liked last week’s How I Met Your Mother finale, but surely disagreeing with that view (as I do) isn’t a disqualifier. So the question that has consumed discussions of the Eich affair is whether someone who’s against gay marriage—or at least donates to that cause—is on the wrong side of the Satan-Scherbatsky line.* Not because that person is equivalent to a Nazi or Communist but because there’s a line somewhere. It’s unfortunate that holding a position that President Obama himself shared until recently got Eich in trouble, but Mozilla’s decision was understandable if it read its economic climate correctly. Silicon Valley apparently doesn’t countenance opposition to gay marriage to such an extent that a business leader who holds that view can’t be effective even if his personal views in no way affect company policy. (That’s one reason why opposition to Arizona’s SB 1062 was misplaced; most businesses that refused to serve gays would take severe financial hits—regardless of whether courts upheld their religious objections.) But lamenting the cultural dynamic that led to such hypocrisy is beside the public-policy point. The whole imbroglio could’ve been avoided with a tweak of disclosure rules. Currently, the identity of anyone making a contribution of more than $200 to a federal political campaign—name, home address, employer—has to be disclosed to the government, which puts that information online. In California, the threshold is $100. The reason for collecting and disseminating this information is rather thin: to prevent corruption and enhance the perceived integrity of the democratic process. Yet small donors hardly corrupt the candidates they support—Barack Obama spent over $1 billion on his reelection—and how do you corrupt a ballot initiative? Imagine that you had to notify a government official each time you attended a rally, or made campaign phone calls, or posted to a blog, or even talked politics with friends. Now imagine that this information would be made public by the government. Would your activities and conversations change? The question answers itself. Brendan Eich’s position thus became untenable not because he made a politically awkward contribution but because election laws revealed that sensitive information to people whose interest had nothing to do with clean elections or corporate governance. But election laws exist so that the governed can monitor the government, not the other way around. Thesolution is obvious: Require disclosures, if at all, only for those who give so much money that the interest in preventing the hypothetical appearance of corruption outweighs the very real potential for harassment—which amount would be far greater than the current per-candidate maximum of $2,600. Then the big boys will have to put their reputations on the line—as they do already; see Harry Reid’s crusade against Charles and David Koch (who are Cato CATO -1.56% donors)—while the average citizen won’t be exposed to retaliation. Let the voters decide what a donation from this or that plutocrat means to them, rather than enabling vigilantes to police the Satan-Scherbatsky line. * Robin Scherbatsky is a character on How I Met Your Mother, and her last name is the most euphonic/memorable of the major characters. Ilya Shapiro is a senior fellow in constitutional studies at the Cato Institute and editor-in-chief of the Cato Supreme Court Review.

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