Marian L. Tupy
The leaders of the congressional intelligence committees say that the United States is not safer today than in recent years.
Sen. Dianne Feinstein (D-Calif.), chairwoman of the Senate Intelligence Committee, and Rep. Mike Rogers (R-Mich.), chairman of the House Intelligence Committee, said in an interview aired Sunday on CNN’s State of the Union that terrorism is up worldwide and the United States needs to be vigilant to combat the growing threats.
CNN’s Candy Crowley kicked off her sit-down interview, asking, “Are we safer now than we were a year ago, two years ago?”
“I don’t think so,” Feinstein replied. “I think terror is up worldwide, the statistics indicate that. The fatalities are way up. The numbers are way up.” Rogers concurred. “I absolutely agree that we’re not safer today … the pressure on our intelligence services to get it right to prevent an attack are enormous. And it’s getting more difficult.”
The recent uptick in terrorism reminds us of the need to remain vigilant. But it is also important to keep in mind long term trends. Below are two graphs generated by Cato’s new website, www.humanprogress.org, using Harvard University Professor Steven Pinker’s data. According to Pinker, there has been a sustained downward trend in deaths from terrorism.
Ilya Shapiro and Trevor Burrus
While much attention has focused on the Senate’s recent vote to eliminate the ability to filibuster judicial and executive nominations, another aspect of constitutonal separation of powers will come to the fore in January when the Supreme Court hears argument in NLRB v. Noel Canning.
The Recess Appointments Clause, which gives the president the power to “fill up Vacancies” in federal offices and judgeships that “may happen during the Recess of the Senate,” allows the president to fill vacancies without going through the normal requirements of obtaining the Senate’s “advice and consent.” The Framers understood that, particularly during the nation’s early days, the president and the rest of the executive branch would be the only members of the government in Washington for the entire year, so important offices may become vacant while the Senate was out of session. The Recess Appointments Clause would thus be an important but rarely used exception to the normal confirmation process.
For nearly 200 years, however, presidents have been whittling down the clause’s requirements. For the first three decades of the Constitution, the clause was interpreted to apply only to vacancies that occurred during a recess—perhaps because a cabinet member died—and didn’t apply at all to vacancies that existed while the Senate was in session. During the Monroe administration, the attorney general first authorized appointments to offices that were vacant during the previous recess.
Next was the question, “what is a recess?” There are official breaks between Senate sessions, so-called “intersession” recesses, but the Senate also takes many breaks during official sessions—whether for Christmas, a weekend, or lunch—so-called “intrasession” recesses. During the Harding administration, the attorney general first authorized a recess appointment during an intrasession recess.
Then came the question of how long such an intrasession recess has to be in order to activate the president’s recess-appointments power. President Harding’s attorney general authorized an appointment during a 28-day recess, and that length has been decreasing ever since. Both Presidents Clinton and George W. Bush made recess appointments during 10-day intrasession recesses.
After Bush made some controversial appointments in this manner, Senate Majority Leader Harry Reid began holding pro forma sessions every three days during intrasession recesses in order to block further appointments. (During a pro forma session a lone senator gavels an empty Senate to order and 30 seconds later ends the session.) Some describe these as “sham” sessions, but they’re official according to the Senate’s rules. Since Reid devised these pro forma proceedings, both parties have used them to block potential recess appointments. According to the congressional record, the Senate is never out of session during these breaks for more than three days.
President Obama decided to push the degradation of the Recess Appointments Clause to its next logical step by declaring that pro forma sessions were not “actual” Senate sessions. He thus could ignore them and, on January 4, 2012, recess-appointed three members to the National Labor Relations Board, as well as Richard Cordray to head the Consumer Finance Protection Bureau. Legal challenges were immediately filed, and Obama has now lost in three lower courts. The U.S. Court of Appeals for the D.C. Circuit not only invalidated the president’s appointments, but returned the Recess Appointments Clause to its original meaning—that it only applies to vacancies that come into being during an intersession recess.
The government appealed that ruling to the Supreme Court, and Cato has filed an amicus brief supporting the challengers, a canning company. In the brief, we argue for the “lowest common constitutional denominator” that can decide the case. While we fully endorse returning the Recess Appointments Clause to its original meaning, the Court need not go that far. Indeed, the Court need only answer one question to invalidate President Obama’s recess appointments: “Who decides if the Senate is in session?”
Whereas previous presidents had taken the less egregious step of redefining a “vacancy” and a “recess,” Obama went further in defining an “actual” Senate session. We argue that separation of powers demands that the president not be allowed to meddle in the Senate’s internal processes, which the Constitution commits to the Senate’s discretion. (It would even be illegitimate for the Supreme Court to define a Senate session!) We also argue that the president created an ad hoc standard to define a Senate session, which arbitrariness only underscores how dangerous it is to allow the executive to encroach on the legislative branch.
Finally, we point out that the Recess Appointments Clause is on its last legs; unless the judiciary intervenes, there will only be political gamesmanship divorced from constitutional principle. Without the Supreme Court’s strong guidance, the Senate will increasingly have to jump through hoops of the president’s creation to perform its duty to advise and consent on nominations. After 200 years of drift, there’s no reason to believe the political shenanigans will stop here. The Court should stop this constitutional erosion now.
Discussing the problems with a soda tax is both easy and difficult. It is easy because the main argument is fairly obvious: If taxing soda in the name of public health is a legitimate function of government, then there is no functional limit on what government can do under the guise of public health.
But this argument, though straightforward, is a difficult sell because it is not terribly convincing. This is partially because it is a slippery slope argument (“step 1 will inexorably lead to step 10”), and slippery slope arguments are often straw-man arguments. Arguing against step 10 (“so why don’t we just tax all bad foods?”) is not actually the argument being made at step 1 (“I think we should tax soda.”).
The other reason the argument is difficult is because it is hard to ignore the science. Perhaps it is true that a tax on soda will help public health. In fact, I’ll concede for the sake of argument that taxes on soda will increase public health.
So, as someone who opposes soda taxes, what arguments do I have left if I’ve made these concessions? There are three: 1) The Primitivism of Politics; 2) The Modern Fallacy of “Public Health”; and 3) A Properly Formulated Slippery Slope Argument
1) The Primitivism of Politics
What I call “primitivism” could also be called “tribalism” or “special interests.” Politics becomes increasingly primitive as it affects more of our most personal decisions. When politics starts deciding how to educate our children, what health care we can buy, and what we can freely eat or drink, our only way to fight back is by forming interest groups and “making our voices heard” in the city council, the state legislature, or Washington, D.C. In other words, those with tribes win; those without lose. Despite the efforts of the soft drink industry, the soda drinking tribe is clearly losing its effectiveness.
Why? Well, partially because rates of soda consumption are starting to mirror class divisions. According to one poll, only 11.2 percent of those living in upscale Chelsea or Greenwich Village drink at least one “sweetened beverage a day.” Soda guzzlers are often perceived to be of a lower class. We don’t usually think of a bright-eyed Harvard grad going into her office at Mayer Brown carrying 64 ounces of Mountain Dew Arctic Burst. No, we think of her carrying a Venti Caramel Brulée Frappuccino, brimming with 520 calories and 50 percent of her recommended daily allowance of saturated fat. That’s about as many calories as one liter of soda and significantly more fat.
Why should sodas be taxed and not the frothy coffee concoctions that are often preferred by upper-class people who, not coincidentally, tend to make the laws? Some people may think that both should be taxed, but a “Starbucks tax” is not currently on the table.
As the push for marijuana legalization gains momentum, tobacco users are being increasingly marginalized. Is there a coherent principle that animates this difference other than that the tobacco smoking tribe is shrinking while the marijuana smoking tribe is growing? Similarly, is there a principle that exempts coffee drinks from health taxes? Perhaps it is asking too much for politics to be principled, but maybe we can demand more than a primitive battle between interest groups where the preferences of the ruling class usually win.
2) The Modern Fallacy of “Public Health”
Although the concept of public health was and is important when dealing with broadly agreeable initiatives, such as waste abatement and vaccination, it is increasingly becoming a politicized concept.
Individuals are either healthy or unhealthy within a society, but society itself isn’t one or the other. Individuals’ decisions about what risks they are willing to take and how much they are willing to trade pleasure for diminished health are incredibly personal and should not be overly politicized. This becomes more difficult when health care costs are increasingly socialized, but the principle that health care decisions are deeply personal should be adhered to as much as possible.
Some people skydive, some people eat rare hamburgers daily, some people drink soda. All of these can be hazardous to your health. But what isn’t included in statistics about public health is the pleasure that people take in doing things and consuming things that may not be healthiest. The optimally healthiest society may not be the best society to live in, and we should be weary of technocrats making subjective judgments about trade-offs between health and pleasure.
3) A Properly Formulated Slippery Slope Argument
Although the traditional form of the slippery slope argument is often fallacious as I’ve discussed, it is possible to formulate an effective slippery slope argument: If the principle that animates step 1 is identical to the principle that animates step 10, then there is no “limiting principle” to stop the progression. This is particularly true in law where past decisions become precedents.
The movement to tax and prohibit unhealthy things seemingly has no clear limiting principle. It is worth pondering extreme counter-examples to see if we can deduce a limiting principle (somewhat similar to the infamous “broccoli question”—can Congress make you purchase broccoli?—during the Obamacare litigation): If certain style of haircut were shown to significantly contribute to health, would mandating or subsidizing that haircut or taxing other haircuts be off-limits? Should video games be taxed because they contribute to couch potato-ness?
These questions can help us focus on another question: namely, are we treating free, responsible adults with the respect they deserve? We aren’t regulating “society,” after all, we’re regulating people. Yet many public-health proposals treat free, responsible adults as if they are resources, asking only whether their behaviors make them take too much or give too little. Conservatives often make similar arguments about drug use—that legalizing drugs will lead to lost work production and the moral decay of society.
Arguments like these do not treat people with respect, and they encourage lawmakers and technocrats to regard people with different tastes as parasites rather than people.
We should be better than that.
Kuwait City, Kuwait—“I read your blog post,” Dr. Anood Al-Sharikh told me when we met. “Kuwait isn’t really liberal, but more liberalish, don’t you think?”
She’s right, though in the Middle East even liberalish is a major advance over ugly authoritarian systems like the Saudi theocracy. Kuwait hosts many traditionalists and Islamists who live conservatively, but there is space for most everyone. Many women, like Al-Sharikh hold professional jobs, travel the world, and dress fashionably.
Moreover, politics is freer than elsewhere in the Gulf. Kuwait is ruled by an emir who appoints government ministers, but an elected National Assembly can challenge government ministers and force a cabinet’s resignation. On Tuesday I sat through some the “grilling” of the health minister, a liberal royal who I met last year when he was working in the prime minister’s office. Animated legislators vigorously challenged his performance as well as the arguments of their colleagues while pushing a no confidence motion.
Still, the government clearly has the upper hand, aided by problems elsewhere in the Gulf. A year ago, Kuwait was host to multiple demonstrations by an angry opposition which ranged from secular liberal to Islamist. Today “things have calmed down,” noted Waleed Moubarak of Alghanim Industries. That’s positive, in his view, since you “can only sustain so much political drama.”
But more happened than people being worn out. The authorities “sucked the wind out of” the opposition movement, noted Al-Sharikh. The “government struck back effectively” in a notably illiberal fashion, jailing some people and using its various forms of influence. It even pressed Islamist clerics to issue fatwas against the opposition. Moreover, she asked, “how can anyone in Kuwait be against the government,” which offers jobs, provides homes, pays for education, and more.
Internal contradictions hobbled the opposition: by allying with Islamists, the liberals were effectively promoting a political agenda that included imposing dress codes, closing churches, executing blasphemers, and enshrining sharia as the fount of law. Equally important, the collapse of the Arab Spring had a sobering effect. A bank analyst told me “the public was fed up, it saw chaos in Egypt, violence in Syria, and said that is not for us. People decided there was more to lose than to gain if they went down that particular route.”
In fact, Kuwait well demonstrates the tensions between a democratic polity and liberal society. Thus the “liberalish” country’s fascinating paradox: today, at least, Kuwait’s hereditary emir might be more likely than an elected parliament to encourage development of a free society.
In the bad-old-days of American intelligence, J. Edgar Hoover maintained a notorious “Sex Deviate” file filled with salacious bits of information on the sexual proclivities of prominent Americans: actors, columnists, activists, members of Congress, and even presidents. Sometimes this information could be immediately useful—as when Hoover’s right hand Cartha DeLoach proudly reported that the Bureau had learned of a truculent senator caught driving drunk with a “good looking broad.” The senator, DeLoach explained, was promptly made “aware that we had the information, and we never had trouble with him on appropriations since.” But Hoover could be patient as well: In the 1940s, the FBI investigated and wiretapped columnist and suspected German spy Inga Arvad, who happened to be conducting an affair with a young naval ensign named John Kennedy. When Kennedy won the Democratic presidential nomination 17 years later, the Arvad dossier was immediately moved to Hoover’s personal office file. Sometimes the information was used to discredit Hoover’s political enemies through targeted leaks; on other occasions, the threat of exposure was enough.
The National Security Agency has clearly learned to apply Hoover’s tactics in the war on terrorism: In a new Huffington Post story based on documents leaked by Edward Snowden, Glenn Greenwald reports that the NSA discussed how Islamist “radicalizers” could be discredited by exploiting information—presumably obtained through electronic surveillance—about their online sexual activities.
Critically, the six “radicalizers” mentioned in the NSA document do not appear to have been directly involved in terrorism: They are described only as preachers of extremist ideas. Indeed, the document notes that the three English-speaking “radicalizers,” one of whom is identified as a “U.S. person,” seem to have had minimal contact with members of violent groups, and one is characterized as explicitly condeming violence against civillians. Nevertheless, the Agency urged that such “vulnerabilities” as “online promiscuity” or “viewing sexually explicit material online” could be used to discredit these “radicalizers” by exposing them as hypocrites.
While it’s not clear whether the NSA—or one of its client agencies—ever carried through on this plan, even compiling and disseminating such derogatory information about a U.S. person guilty of no more than vile (but nevertheless First Amendment protected) speech would be, prima facie, illegal. But given the breadth of NSA’s collection, records of the online sexual habits of millions of others who might one day be deemed “radicalizers” of one stripe or another are almost certainly sitting in a database waiting to be mined and deployed.
The report underscores one of the primary reasons intellgience surveillance in particular is so susceptible to abuse. In criminal investigations, the paradigmatic government use of information gleaned from wiretaps or other forms of spying is as evidence in a criminal trial, where the government’s actions are subject to eventual scrutiny and legal accountability. But in the realm of intelligence, only rarely are the fruits of surveillance used in criminal prosecution—eliminating the primary “back end” institutional check on government spying. Often, the point is precisely to make use of information from intercepts in ways that can never be directly or publicly traced to government. A target whose reputation or career is torpedoed by embarassing disclosures may never know whether they were the victim of an intelligence operation or simple bad luck.
The U.S. legal system is ill-designed to guard against such tactics: Our primary safeguard—indeed, in most cases the only safeguard—against violations of the Fourth Amendment is the “exclusionary rule,” which prohibits evidence derived from illicit surveillance from being used against a defendant at trial. When, instead, intelligence agencies use surveillance to attack their targets through means other than prosecution, no court or judge is ever likely to review their work. You may not be engaged in any criminal conduct, but does that really mean you have “nothing to hide” from government? Check your browser history before answering too confidently.
Obamacare’s legal troubles were far from ended when Chief Justice Roberts ruled in 2012 that the law’s “penalty” for failing to buy health insurance was really a “tax,” purportedly rendering the Act constitutional under Congress’s power to tax, even though neither he nor anyone else could say whether the Constitution recognized or allowed so sui generis a tax.
So far is the litigation from over, in fact, that if you’re planning a legal challenge to Obamacare, you’ll have get in line. Two of those in line got good news today: The Supreme Court has agreed to hear their challenges. Both concern Obamacare’s mandate that employer provided health insurance policies cover such things as sterilization, contraceptives, and abortifacients, even in the face of an employer’s religious objections. In Sebelius v. Hobby Lobby Stores, Inc. the U.S. Court of Appeals for the Tenth Circuit ruled for the individual employer. In Conestoga Wood Specialties Corp. v. Sebelius the U.S. Court of Appeals for the Third Circuit ruled against the corporate employer. At issue are both constitutional and statutory claims under the Religious Freedom Restoration Act (RFRA).
Ilya Shapiro has discussed the issues more fully here. And earlier on I had a short post on the subject here. The Court will likely hear oral argument in March. Maybe the website will be running by then.
The Washington Post brings us some sad news today: Peter Lewis has died of a heart attack.
If you watch any television at all, you will see many TV commercials for Progressive Auto insurance, featuring the wise-cracking, Flo, with her 1960s hairdo, but Peter Lewis was the man who took the helm of the company as CEO in 1965 and turned a small company into one of the largest auto insurers in the USA.
After serving as CEO for 35 years, Lewis retired to focus on philanthropy. He saw the futility and countless injustices of America’s drug war policies and financially supported organizations that worked to end drug prohibition, including the Cato Institute.
In ten years (less?) marijuana will be a legally sold product in much of the United States, and too many people will casually assume that it was somehow inevitable. Last December, following the successful initiatives to legalize marijuana in Colorado and Washington, I told an adviser to Lewis that when the history of the drug war is written, he will be remembered as one of the heroes. I am glad Lewis lived to see the turning of the tide on drug policy here in the USA.
With the dust barely settled following Harry Reid’s bombshell late last week—killing Senate filibusters of appellate court nominees, the obvious purpose of which was to enable the DC Circuit’s eventual rubber-stamping of Obama’s rule by executive order—the Wall Street Journal is now reporting that the Obama administration today “proposed a crackdown on the widespread use of tax-exempt organizations for political campaigning, seeking to reduce the influential role that the secretive groups have played in recent elections.” The timing is exquisite.
It’s hardly news that the administration (and the left generally) is obsessed with limiting political speech—and with the Supreme Court’s 2010 Citizens United decision in particular. Recall the president’s appalling breach of decorum when in his State of the Union Address two weeks later he ridiculed the captive justices sitting before him, to the cheers of the Democrats standing in applause over them. The obsession has continued, manifesting itself most notoriously in the IRS stonewalling of Tea Party applications for 501(c)4 tax-exempt status. Now, we’re told, the new “guidance” issued today “by the Treasury Department and the Internal Revenue Service would curtail a broad array of these tax-exempt entities’ activities, including campaign advertising, voter registration, get-out-the-vote efforts, and distribution of voter guides and campaign materials”—all designed, one Treasury official said, “to simplify the task of policing the groups for the IRS, by drawing brighter lines.”
Thus, under the current standard, the Journal reports,
a tax-exempt entity could run TV ads in the run-up to an election, congratulating a candidate for introducing a bill, and urging the legislature to enact it into law and viewers to support candidates who back that issue, officials said. Under the new standards, the group wouldn’t be able to count that as exempt activity if it is run within the 60-day or 30-day window.
Groups also are able to do voter registration drives and get out the vote efforts now, as long as it isn’t done in support of a particular candidate. But under the new standard, groups couldn’t do voter registration drives as part of their exempt activity, even voter drives that aren’t overtly partisan or political.
I won’t go into the arcane contribution limits or disclosure requirements that are contemplated by this proposal. But I will note that none of this would be necessary if only we could give directly to candidates and their parties far more than our crabbed current law allows. But that would mean that incumbents would face stiffer competition than they now do under current restrictions. And that’s the dirty little secret of our campaign finance law. It parades as corruption prevention, but at bottom it’s incumbent protection.
23andMe is a service that combines a home-based saliva testing DNA-sample kit combined with a web-based service to explain what the results mean and put you in touch with other users. At $99, it’s a breakthrough hit in affordable personal technology – and now the Food and Drug Administration is determined to snuff it out. I discuss this appalling development in a new post at Overlawyered:
…Some of us want to seek out distant relatives and clues about national origins, or satisfy curiosity about patterns of disease in our family lines. For adoptive families, home genome testing can be hugely valuable in cases where one knows little about the medical history of an adoptee’s birthfamily. It’s our body, and our right to inform ourselves about it — or so we thought.
The FDA very likely has decent legal grounds to forbear from a crackdown should it choose to. But the key takeaway sentence from Matthew Herper’s piece in Forbes criticizing the company is: “This is not the way to deal with a powerful government regulator.” Disrespectful, anti-authority attitudes from someone an agency intends to regulate? Ask former Buckyballs CEO Craig Zucker where that gets you. …
Science blogger Razib Khan has suggested that information services like 23andme, rather than submit to expensive and cumbersome regulation as “medical devices,” may simply pack up and move offshore. But even if they do, that won’t be the end of our government’s jealous wish to regulate them – or so I predict in my post.
P.S. Is it relevant that governments themselves, through their law enforcement agencies, run elaborate saliva-, blood- and DNA-collection operations that are hedged with few of the protections of voluntariness, privacy and openness that one finds with 23andMe?
Jaw-jaw is better than war-war said Winston Churchill, who led Great Britain during World War II. Which is reason enough to hope that the interim agreement reached with Iran leads to a permanent settlement. And that North Korea also eventually joins the normal community of nations.
While prospects of peace with Iran appear better—though the road ahead remains long and rocky—the possibility of a similar accord with the Democratic People’s Republic of Korea looks ever further away. The Kim Jong-un government has reactivated the Yongbyon nuclear reactor and begun new excavations at the Punggye-ri nuclear test site. Moreover, Pyongyang recently detained an aging American visitor, Merrill Newman, poisoning any discussions before they start.
The best overall approach to the DPRK is to lower expectations. Pyongyang has proposed nuclear negotiations “without preconditions,” but few observers believe that the North is prepared to give up its nuclear ambitions.
Thus, Washington should take the Kim regime at its word when the latter opined: “The legitimate status of the DPRK as a nuclear-weapons state will go on and on without vacillation whether others recognize it or not.” The U.S. needs to recognize the North’s position de facto if not de jure.
Some would intensify sanctions in response. However, as I point out in my latest Forbes online column:
the Kim dynasty has withstood not only steadily tougher sanctions but poverty and even starvation. Absent a dramatic new effort, backed by the Peoples Republic of China, it is hard to believe the outcome of any new penalties would be any different. To the contrary, the more committed the U.S. appears to be to regime change, the more obvious the case to the North to acquire not just nukes, but many nukes with missiles capable of delivering them to America.
A better strategy would be to defuse the threat environment. The first step is to loosen rather than tighten the U.S.-ROK alliance. The end of the Cold War has robbed the Korean peninsula of any claim to being a “vital” security interest for America.
Moreover, the South’s rise—it now possesses an economy thought to be around 40 times the size that of the DPRK—has eliminated any need for U.S. military support. Washington should extricate itself from the Korean peninsula’s interminable controversies.
The second step is to turn the lead for security developments on the peninsula over to regional powers. If the North’s neighbors, including China, were unable to rely on the U.S., they would have to do more themselves.
The third step for the Obama administration is to deemphasize denuclearization since nuclear negotiations aren’t going anywhere. Indeed, a small North Korean arsenal is a problem much more for the region than for America. Washington’s red line should be proliferation to terrorist groups.
Lastly, Washington should start small-scale engagement with the North, official talks followed by low-key diplomatic relations. An official relationship wouldn’t eliminate the dramatic differences between the two nations, but would open windows into each other’s societies and channels for contact.
After six decades Washington should formally conclude the Korean War with a peace treaty? Negotiation over such a document also would provide another venue for engagement, including South Korea and China. Talks even could include the most difficult topics, such as human rights.
Of course, nothing might change. But there is little downside to opening official discourse, something enjoyed by virtually every other nation.
Frustrations with past efforts to variously conciliate or confront have led to little interest in new approaches toward the DPRK. Washington should try a different strategy: modest diplomatic rapprochement with the North.
In the meantime, Washington should emphasize Winston Churchill’s jaw-jaw over war-war. If that reduced the possibility of conflict even a little bit, it would be a good deal.
Peter Van Doren
An article on page 1 of Thursday’s Wall Street Journal describes the financial problems faced by some private infrastructure owners because of reduced demand from the Great Recession. The story features the Foley Beach Express bridge in Alabama built as a toll concession in the early 2000s. The bridge filed for bankruptcy in July after traffic volumes were lower than projections leaving taxpayers on the hook for millions.
How can private infrastructure financing manage demand uncertainty? Cato’s Regulation answered the question in 2002 with an article entitled “A New Approach to Private Roads.” Traditional private infrastructure concessions utilize a Build-Operate-and-Transfer contract in which a private company builds and subsequently collects tolls and operates a facility for a specified term (20 to 30 years). At the end of the contractual term, ownership of the infrastructure is transferred to the government. The problem with this contractual design is that it involves a combination of “front-loaded investment and substantial uncertainty about demand for the road.” This demand uncertainty increases the probability that revenues fall short of required bond payments causing insolvency.
The authors replace the traditional contract with what they term “Present-Value-of-Revenues” franchising. This method gives the concession to the firm that bids the lowest present value of toll revenues. The franchise is not for a fixed term but ends instead when the present value of the bid is reached. If toll revenues fall short of projections, the term of the franchise lengthens and bond payments are delayed contractually. If revenues are higher than expected, the government can buy out the concession for the difference between the revenues received and the present value bid. The latter contingency avoids the problems found in Orange County (California) Route 91, where traffic volumes were higher than expected, but contract terms barred the county from increasing the capacity of the toll road.
For a good overview of infrastructure and prospects for more private involvement see Chris Edwards’ recent essay at Downsizing Government.
Ted Galen Carpenter
A leading foreign policy scholar once described alliances as “transmission belts for war,” mechanisms for converting local conflicts into far wider and more destructive wars. We now have a graphic example of that danger in the U.S. security treaty with Japan.
Tokyo is embroiled in an emotional territorial dispute with Beijing over a chain of uninhabited rocks in the East China Sea, which Japanese call the Senkaku Islands and Chinese call the Diaoyu Islands. Although Japan administers those islands, Beijing insists that both maritime precedent and history confirm that the territory is rightfully part of China.
That dispute has existed for decades, but tensions have been escalating over the past two years, and have now spiked dramatically. Late last week, Xinhua, the official Chinese news agency, published a map of a newly established East China Sea Air Defense Identification Zone, which includes the airspace over most of that body of water—including the disputed islands. China’s Defense Ministry also released identification rules for aircraft in the zone and stated that “China’s armed forces will adopt emergency measures to respond to aircraft” that don’t abide by those rules. Over the weekend, the Chinese air force began patrols to emphasize the point.
It was hardly a surprise that Japan did not respond well to Beijing’s proclamation. A Japanese Foreign Ministry spokesman stated bluntly that the islands were part of Japan and that Beijing’s actions were an unacceptable attempt to change the status quo. The move was “very dangerous” and could lead to unforeseen, but clearly undesirable, outcomes.
A nasty spat between Asia’s two strongest powers, and the countries with the world’s second and third largest economies, is obviously troubling. But Washington did not help matters by weighing-in immediately on behalf of its Japanese ally. Secretary of State John Kerry not only admonished China to exercise restraint, but emphasized that the United States was “steadfastly committed to our allies and partners.” Officials provided pointed reminders of Washington’s position that the U.S.-Japan security treaty covers the Senkaku Islands. Secretary of Defense Chuck Hagel rebuked China for “a destabilizing attempt to alter the status quo in the region.”
There are a couple of worrisome aspects about the U.S. position. First, although China’s actions are needlessly provocative, Beijing is not the only party to disrupt the status quo. The Japanese government’s decision last year to nationalize the islands from private owners certainly did so. Yet U.S. officials had little to say about that move. Second, Washington’s stance on the underlying territorial dispute is contradictory, if not disingenuous. U.S. leaders simultaneously insist that they do not prejudge the resolution of the territorial matter and emphasize that the security treaty covers the islands. But the treaty applies to the islands only if the United States regards them as Japanese territory. That position definitely prejudges the issue.
Although Japan should be strong enough to defend its own security and national interests without U.S. involvement, one can make the case that protecting Japan and helping to keep it out of Beijing’s orbit is also a legitimate interest of the United States. Whether it is important enough to risk war with China is a much more difficult question, but it is folly to risk such a war merely to back an ally in a murky territorial dispute over some uninhabited rocks. Yet that is a danger we now incur.
This episode is a textbook example of why the United States should use only informal security arrangements, not written, long-term treaties. The former approach gives Washington far greater flexibility regarding the best response to changing conditions. History will not be kind to U.S. leaders if a security treaty causes this country to end up in a military confrontation with China over such meager stakes as the Senkaku/Diaoyu Islands.
America’s Liberal Persian Gulf Friend: An Uneasy Kuwait Confronts Domestic Critics and Regional Threats
Kuwait City, Kuwait—Kuwait is a shrimp among whales in the Middle East. It lies among three much larger states, Iran, Iraq, and Saudi Arabia, all of which have the potential, noted one American diplomat, of swallowing the small Gulf kingdom. Indeed, Baghdad attempted to do precisely that in 1990.
Although more than two decades have passed, Kuwaitis remain grateful to the U.S. They know they would be the 19th province of Iraq absent American military support. The Sheraton, where I typically stay, includes photos of the damage wreaked by Iraqi invaders.
Today Iran looms as the larger threat, though Kuwaitis actually are less concerned about nuclear issues. When your neighbor holds a gun to your head, who cares how big it is, quipped one. With a heretofore well-integrated minority Shia population, most Kuwaitis actually worry more about the Shia-Sunni battle being fought especially vigorously by Iran and Saudi Arabia.
However, most Kuwaitis appear to back the Obama administration’s diplomatic approach. They know that military strikes are an alternative to negotiations, and war would be disastrous. Moreover, Kuwaitis hope future talks ultimately could ease tensions in other areas. Kuwait’s assent offers an important affirmation of Washington’s strategy.
Regional events, not just Iranian threats but the Arab Spring bust, have helped reduce domestic political tensions. Kuwait is among the Gulf’s most liberal societies, enjoying a powerful parliament, vigorous media, and independent population. However, in recent years the political process ran aground, putting both openness and stability at some risk.
In July, Kuwait held the third National Assembly poll in 17 months. Last year the opposition boycotted the election in protest over changed election rules. Demonstrations erupted, sparking a sharp government crackdown. Fractures in what remains a small political community seemed to widen dangerously.
However, the protests have stopped. Enthusiasm is difficult to sustain, while small political communities possess powerful tools to discourage active opposition. Moreover, noted one American observer, there appears to be increased fear of jeopardizing “this island of stability.” There’s a lot to complain about in the current system, but far more could be lost. Indeed, after Islamists won control of the National Assembly in February 2012, it was the hereditary monarch who blocked proposed legislation to base law on Sharia, bar construction of any new churches, and execute blasphemers.
Dr. Sami al-Faraj, a well-connected consultant who advises the royal family, among others, believes that creating a vibrant, opportunity-oriented private sector is the key to permanently easing political tensions. Abundant oil wealth has created a welfare society in which most everyone is dependent on the state, creating what one analyst calls “a transactional state.” The royal family’s control of so much wealth discourages measures to promote private entrepreneurship and democratic governance. As a result, al-Faraj says his country is “continually in a crisis management mode.”
The Middle East has dramatically demonstrated how democracy can become a minefield for liberal, tolerant societies. While Kuwait is not Washington’s most important ally in the region, it is America’s strongest Arab friend. And probably the Gulf’s most free society. Kuwaiti success in moving in a direction that is both liberal and democratic would offer an important model for its neighbors. We should wish the Kuwaitis well.
Christopher A. Preble
Rumors abound that budget negotiators are nearing a possible deal to reverse spending cuts required under the 2011 Budget Control Act (BCA).
Senate Republican Leader Mitch McConnell is hoping his colleagues will stand firm and reject any deal. He told reporters last week that it would be “a bad idea to revisit a law that’s actually working and reducing spending.” But he is competing with military spending advocates such as Reps. Buck McKeon and Mac Thornberry. They claim that the dangers confronting the United States today are graver than ever, that the costs to address these threats are rising and cannot be contained, and removing the defense spending caps is necessary to ensure the United States remains safe and secure.
They are wrong on all counts.
First, some context on spending: The Pentagon’s base budget, excluding the costs of the ongoing war in Afghanistan, remains 26 percent higher than in 2000, in inflation-adjusted dollars. Under the spending caps established by BCA, Pentagon spending would average around $528 billion per year from 2013 to 2021, over 18 percent higher than during a typical year in the Cold War.
This is curious considering the threats facing the United States were far greater then. The threats today are declining, not rising. In fact, all forms of violence, from cataclysmic great power wars, to civil wars and ethnic conflicts, have declined to historic lows.
To be sure, some insurance against potential threats is wise, in the unlikely event that current favorable trends are reversed, but we can maintain our safety while spending less because technological advances allow today’s military to address possible threats with fewer people and fewer platforms. U.S. naval vessels have far more striking power than the early 20th century dreadnaughts, just as precision-guided munitions have rendered today’s aircraft at least 10 times more capable of striking targets as their dumb-bomb-dropping precursors. To be sure, these new platforms are much more expensive, but the military services and their suppliers are more cost-conscious today than a decade ago, as when the Air Force recently killed a plan to outfit the next-generation bomber with a $300,000 kitchenette. Such excesses might be resurrected if BCA opponents succeed in changing the law.
The reforms extend well beyond procurement. In 2011, then-Chairman of the Joint Chiefs of Staff Mike Mullen admitted that the military hadn’t been forced “to make the hard choices” because they had all the money they requested, plus a little more. Today, the spending caps are forcing the services to prioritize.
For example, austerity has focused attention on the military’s antiquated compensation system. Today’s soldiers, sailors, airmen and Marines are better compensated than those who served during World War II or the Cold War. And they should be. A modern military must compete to attract and retain the best and the brightest, and that costs money.
The current trajectory of personnel costs is unsustainable, however. Pay and benefits are already eating into other Pentagon spending accounts, including procurement, operations and maintenance, and training. The net effect may impair military readiness. Now, even outspoken military spending advocates, such as Reps. Duncan Hunter and Adam Kinzinger, both veterans of the post-9/11 military, have endorsed changes, including expecting working-age retirees to pick up more of their health care costs.
There is, in fact, broad, bipartisan support for proposals that touch what were once thought of as the third-rails of Pentagon politics. In addition to compensation reform for active-duty military personnel, a letter signed by scholars from the American Enterprise Institute, the Center for American Progress, and the Brookings Institution, among others, also calls for shrinking the Pentagon’s sprawling civilian workforce and reducing overhead, including eliminating excess base capacity.
The most important piece of the military spending puzzle remains the United States’ hyperactive foreign policy. Even if we were to implement the sensible reforms made politically realistic by spending caps, we would still spend more than we need to keep Americans safe. That is because today’s military is mainly geared toward defending others. By discouraging our allies from doing more to defend themselves and their interests, U.S. policymakers have ensured that U.S. troops bear disproportionate burdens, and U.S. taxpayers pay disproportionate costs. If we are going to spend less on the military in the next ten years than we have over the last ten, we must ask our smaller, cheaper military to do less. And we must expect others to do more.
The Budget Control Act, for all its flaws, has managed to deliver something once thought impossible: actual spending cuts. Our military remains second to none, despite those cuts, and might be stronger in the future because of them. A deal to cancel or reverse those cuts threatens to derail sensible reform proposals that could deliver far larger savings to taxpayers in the future.
Sen. McConnell is right: Congress should stand firm.
Steve H. Hanke
With the announcement on Saturday night that Iran and the P5+1 group reached a tentative deal over the Iranian nuclear program, the Iranian rial appreciated 3.45% against the dollar on the black market. The rial jumped from 30000 IRR/USD on Saturday November 23rd to 29000 IRR/USD on Sunday November 24th. A daily appreciation of this magnitude is rare. In fact, it has occurred fewer than ten times since the beginning of 2013. Indeed, this indicates that the diplomatic breakthrough is having a positive effect on Iranian expectations.
Over a year ago, I uncovered the fact that Iran experienced a period of hyperinflation (in early October 2012), when its monthly inflation rate peaked at 62%. Since then, I have been actively monitoring and reporting on the IRR/USD black market exchange rates and calculating implied inflation rates for the country.
Since Hassan Rouhani took office, on August 3rd, Iranian expectations about the economy have turned less negative. Thus far, it appears Rouhani has been successful in ending the long period of economic volatility that has plagued Iran, since the US imposed sanctions in 2010. This has been reflected in the black-market IRR/USD exchange rate, which has held steady around 30,000 in recent weeks (see the accompanying chart).
There are three main factors at work here. The first is a concerted effort by the Rouhani administration and the central bank to curb Iran’s inflation. This stands in stark contrast to the previous regime, whose strategy was to simply deny that inflation was a problem.
The second is that that Iran’s economy has proved remarkably “elastic” – meaning that the country has ultimately adapted to the sanctions regime and has found ways to keep its economy afloat in spite of them.
The third factor in the rial’s recent stability is an improvement in Iranian economic expectations. This is where the P5+1 talks come into play. Iranians recognized that easing of the sanctions regime would be a bargaining chip in any nuclear negotiations. In consequence, their economic expectations improved as the talks progressed. Indeed, Saturday’s announcement gave these expectations a shot in the arm.
In light of the rial’s recent stability, I have delisted the rial from my list of “Troubled Currencies,” as tracked by the Troubled Currencies Project. For starters, the rial no longer appears to be in trouble. And, on a technical note, implied inflation calculations are less reliable during sustained periods of exchange rate stability.
That said, we must continue to pay the most careful and anxious attention to the black-market IRR/USD exchange rate in the coming months. Like the P5+1 agreement, Rouhani’s economic progress in Iran is tentative and likely quite fragile. Since the black-market IRR/USD is one of the only objective prices in the Iranian economy – and perhaps the most important one of all – it will continue to serve as an important weather vane, as the diplomatic process continues, and as Iran’s economy gradually moves into a post-sanctions era.
In the 19th Century, when railroads were being built across the West, the federal government granted significant land and benefits to railroad companies. The Great Railroad Right-of-Way Act of 1875 empowered the government to grant railroad companies right-of-way easements to build tracks across others’ land to facilitate the expansion of the nation’s railways – that is, railroads were granted a right to use sections of another’s property for railroad purposes without owning title to the land underneath. In 1976, the government sold the Brandt family a parcel of land in Wyoming which was crossed by one of these railroad easements.
In 2001, the railroad that owned the easement formally abandoned all claims to it. Typically, when this happens, the easement is simply extinguished and the owner of the land may then use the former easement however he or she wishes. But the federal government had different plans for the thin strip running through the Brandts’ land. In 2006, the government sued for title to the land lying under the former easement on the theory that it had retained a “reversionary interest” in the land when granting the railroad the right of way easement, even though it never actually set aside any interests when granting the easement. The government thus claimed that after the railroad abandoned the easement (after only ever owning an easement and never full title to the land), full title to the land “reverted” back to the federal government. The Brandts argue that under the basic principles of the common law of property, the government had no such right, and that even if any legislative act allowed the government to somehow acquire their land, such an act would require payment of just compensation under the Fifth Amendment’s Takings Clause.
Although this may seem like a small, unique problem, the scope of the Old West’s railway system was huge and those old easements criss-cross the land of thousands of property owners. In 1983, Congress amended the National Trails System Act to allow the government to take abandoned railroad easements and turn them into land for public recreation and “railroad banking.” Landowners have been fighting the taking of their property under the Trails Act ever since, claiming, as here, that the government’s original grant to the railroads contained no residual right of possession for the government.
After the trial court rejected the government’s radical claims, the U.S. Court of Appeals for the Tenth Circuit split with the Seventh and Federal Circuit courts (and ignored some of its own precedent on the way) and held that the government did indeed have a reversionary interest in the land, even though it never actually carved itself an exception, as the law requires. The Brandts, faced with the uncompensated government confiscation of a strip of land cutting their property in two, have now brought their case to the Supreme Court in an attempt to keep the government’s hands off their land and off the land of thousands of other landowners in their same position.
After supporting the Brandts’ request for Supreme Court review, Cato, along with four other groups and several property law professors – including Richard Epstein – has now filed a brief supporting the Brandts’ fight against the government’s poorly justified land-grab. We argue that the Tenth Circuit’s decision threatens to unsettle longstanding presumptions of property law because it willfully ignores basic differences between easements and “fee estates” in land and other basic principles of property law like the “strip and gore” doctrine (which holds, for example, that land under a right-of-way is split down the center and owned by those who own the land on either side of the easement).
This case is important, because there are many thousands of miles of old railroad rights-of-way crossing the countryside that would be potentially subject to uncompensated government confiscation if the Court were to follow the Tenth Circuit’s approach. In addition, some 3,000 to 4,000 miles of old railroad easements are abandoned every year. It’s not entirely surprising that the government would go full throttle on such a shoddy legal argument for the chance to be able to snatch this land back without having to pay for it. The surprising thing is that the Tenth Circuit green-lighted it. We urge the Supreme Court to switch tracks.
The Court will hear argument in Brandt v. United States on January 14.
Cato legal associate Julio Colombo co-authored this blogpost.
Today (Nov. 23) is Repudiation Day, a special holiday recognized by law in Frederick County, Maryland, where I live. In 1765, judges here “became the first to repudiate the British Stamp Act designed to maintain the costs of keeping British troops in America. [They] decided they were not going to charge the tax and refused to stamp the documents … The late Judge Edward Delaplaine called [them] the ‘12 immortal judges.’” More at the Wikipedia entry and in this 2006 column by Joe Volz at the Frederick News-Post (via Brian Griffiths, Red Maryland/Baltimore Sun).
Can you think of any other holiday that celebrates judicial resistance to overweening government and onerous taxation? I can’t.
The post-mortems today, after Harry Reid yesterday dropped the “nuclear option” on the Senate floor, then headed out of town, contain few surprises. As expected, the editorialists at the New York Times, headlining their thoughts with “Democracy Returns to the Senate,” called the 52-48 vote to end filibusters for appellate court nominees “long overdue.” The Times’ history goes back all of five years, conveniently ignoring the origins of the practice in the 108th Congress, when Democrats were in the Senate minority, as I outlined here and here yesterday. (See here for a detailed discussion of the period before that.)
At the Washington Post, however, one might be surprised to find not only the editors but two reliably liberal columnists, Dana Milbank and Ruth Marcus, on the other side. But in an effort to be even-handed, the editors, among other things, call the Republican rationale for recently filibustering three Obama nominees to the DC Circuit Court of Appeals—that the court’s workload does not justify adding new judges—a “pretext.” Yet as I outlined yesterday, the facts say otherwise, clearly, and do so far more than when Democrats used that rationale, successfully, in 2006.
Which brings me to a couple of little noted points in the reportage that has followed yesterday’s bombshell. Not only have the facts been too often little aired in much of that, when not outright misreported, but the “both-sides-have-been-guilty” meme has been uncritically prominent. It’s true, of course, that Republicans too have filibustered some of Obama’s appellate court picks. But the sequence matters—or, as parents concerned not simply with peace but with justice often ask, “Who hit first?” Turn-around is fair play, as we say. And that’s what galls so many about the events of yesterday. As many have noted, even those who oppose judicial filibusters, Reid was fine with Democratic filibusters of George W. Bush’s appellate court nominees. He couldn’t endure the turn-around.
It was Mr. Dooley who first reminded us that “politics ain’t beanbag,” which old-line Democratic pols like Tip O’Neill took to heart and practiced like an art. That analogy with sports—let’s stipulate that beanbag is “sports” of a sort—is instructive. We don’t give a guy hitting only .200 four strikes, or require a clearly superior team to gain 15 yards for a first down. So too in politics: Whatever the rules may be, they have to be followed equally or one side is playing a suckers game. I raise this issue because we’re already hearing Republican stirrings that, given pressure from the base, they “will be unable to resist using the same power” Democrats have now used. Where is Mr. Dooley when he’s needed?
But a second point, too little noted, concerns the implications from there being numerous “judicial emergencies” in the other circuits—vacancies in seriously overworked circuits for which the president hasn’t even named anyone. Judicial emergencies have increased 90 percent since 2006, and the vacancies with nominees have declined from 60 percent to 47 percent. Yet rather than attend to filling those vacancies, Obama and Reid are focused on adding three more judges to the already seriously underworked and overstaffed DC Circuit. That speaks volumes, of course, about what their agenda is. As I wrote yesterday, the DC Circuit’s docket is mostly about challenges to administrative decisions. Judges in such cases have considerable discretion about whether or not to defer to the judgment of those agencies. If you want to rule by executive diktat, as Obama plainly does, you’ll want “your people” on that court, deferring to “your people” at EPA, HHS, OSHA, the FEC, the IRS, and so on down the line. Let the folks out in the country wait a little longer to get justice. Washington needs to get to the business of “fundamentally changing America.”
Fareed Zakaria’s new column is titled (at least on the Washington Post website) “Why Americans Hate Their Government” or (in the paper) “Why We Hate our Government.” But some of the points he makes might better be seen as reasons not to keep on expanding a government that has grown beyond its competence.
Washington is having one of its odd debates as to whether the Obama administration’s rollout of HealthCare.gov was worse than the Bush administration’s response to Hurricane Katrina. But whatever the answer, if there is one, the real story is that both are examples of a major, and depressing, trend: the declining competence of the federal government. Paul Volcker, former chairman of the Federal Reserve, has been saying for years that most Americans believe their government can no longer act effectively and that this erosion of competence, and hence confidence, is a profound problem.
“The federal service is suffering its greatest crisis since it was founded in the first moments of the republic,” scholar Paul Light writes in his book “A Government Ill Executed.”
Over the past decade, the federal government has had several major challenges: Iraq, Afghanistan, a new homeland security system, Katrina and Obamacare. In almost every case, its performance has been plagued with mismanagement, massive cost overruns and long delays.
Zakaria argues that this was not always the case: “In the 1940s, ’50s and ’60s, federal agencies were often lean, well managed and surprisingly effective.” Maybe so, depending on your metric. But of course in those decades the federal government had not yet undertaken cradle-to-grave responsibilities. Maybe the lesson is that if you want competent government, you should limit it to manageable tasks.
On the other hand,
If you want the federal government to tax (and borrow) and transfer $3.6 trillion a year, if you want it to build housing for the poor and give special benefits to Alaska Natives, if you want it to supply Americans with health care and school lunches and retirement security and local bike paths, then you have to accept that such programs come with incentive problems, politicization, corruption, and waste.
In that case, this is the business you have chosen.
Elane Photography LLC v. Vanessa Willock is the case in which an Albuquerque, NM woman has (thus far successfully) sued husband-and-wife photographers under New Mexico’s “public accommodations” discrimination law for their reluctance to shoot photos of her commitment ceremony to a female partner. One of the most dismaying elements of the case is that the American Civil Liberties Union has taken the anti-liberty side. Adam Liptak in the NYT:
I asked Louise Melling, a lawyer at the American Civil Liberties Union, which has a distinguished history of championing free speech, how the group had evaluated the case.
Ms. Melling said the evaluation had required difficult choices. Photography is expression protected by the Constitution, she said, and Ms. [Elane] Huguenin acted from “heartfelt convictions.”
But the equal treatment of gay couples is more important than the free speech rights of commercial photographers, she said, explaining why the A.C.L.U. filed a brief in the New Mexico Supreme Court supporting the couple.
The ACLU of all groups should have no reason to see this as a “difficult choice” or as a conflict of constitutional values. Free speech and expression rights, which extend to the right not to engage in expression on behalf of a cause one deplores, are central constitutional values and the ACLU is the very first organization people turn to to defend them. Equal treatment of gay couples by private actors, on the other hand (as distinct from by the government itself) has no clear status as a constitutional value at all.
Shame on the ACLU for selling out civil liberties principle in favor of its current notions of civil rights. As Jacob Sullum points out, if it “cannot bring itself to stand up for Huguenin’s rights, it should at least have the decency to sit this one out.” In the mean time, it would do well to adopt some new and changed name on its letterhead, such as American Civil Rights Union.
I’m happy to say that Cato (with law professors Dale Carpenter and Eugene Volokh) filed an amicus brief supporting the photographers’ rights before the New Mexico Supreme Court, albeit unsuccessfully. Certiorari has now been sought at the U.S. Supreme Court.